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TWENTY-FIFTH ANNUAL REPORT
OF THE
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
COVERING OPERATIONS
FOR THE YEAR 1938
UNITED STATES OF AMERICA
WASHINGTON: 1939
BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM
December 31, 1938
MARRINER S. ECCLES, Chairman
RONALD RANSOM, Vice Chairman
M. S. SZYMCZAK
JOHN K. MCKEE
CHESTER C. DAVIS
ERNEST G. DRAPER
LAWRENCE CLAYTON, Assistant to the Chairman
ELLIOTT THURSTON, Special Assistant to the Chairman
CHESTER MORRILL, Secretary
LISTON P. BETHEA, Assistant Secretary
S. R. CARPENTER, Assistant Secretary
J. C. NOELL, Assistant Secretary
WALTER WYATT, General Counsel
J. P. DREIBELBIS, Assistant General Counsel
GEORGE B. VEST, Assistant General Counsel
B. MAGRUDER WINGFIELD, Assistant General Counsel
LEO H. PAULGER, Chief, Division of Examinations
R. F. LEONARD, Assistant Chief, Division of Examinations
C. E. CAGLE, Assistant Chief, Division of Examinations
E. A. GOLDENWEISER, Director, Division of Research and Statistics
WOODLIEF THOMAS, Assistaiit Director, Division of Research and Statistics
LAUCHLIN CURRIE, Assistant Director, Division of Research and Statistics
EDWARD L. SMEAD, Chief, Division of Bank Operations
J. R. VAN FOSSEN, Assistant Chief, Division of Batik Operations
J. E. HoRBETT, Assistant Chief, Division of Bank Operations
CARL E. PARRY, Chief, Division of Security Loans
PHILIP E. BRADLEY, Assistant Chief, Division of Security Loans
0. E. FOULK, Fiscal Agent
JOSEPHINE E. LALLY, Deputy Fiscal Agent
CONTENTS
TEXT OF REPORT
PAGE
Foreword
Summary
Composition of the Banking System and Trends in Banking
Public Supervision of Banks
Relation Between Supervisory and Credit Policies
Nature and Function of Bank Reserves
The Banking System Today
Composition of the Banking System
Changes in Character of Banking
Laws and Jurisdictions to Which Banks Are Subject
Discriminatory Federal* Laws
Bank Supervision
„. .
Allocations of Authority
Confusion and Conflict of Authority
\ .
Relation Between Supervisory and Credit Policies
The Problem of Reserves
Reserves and Credit Regulation
Sources of Reserves
Long-view Problem Raised by Excess Reserves
1
2
2
2
4
4
6
6
7
8
10
11
11
12
16
18
18
19
21
Course of Business in 1938
Gold and Capital Movements
Banking and Credit Conditions in 1938
Earnings and Expenses of the Federal Reserve Banks
Branches and Agencies of the Federal Reserve Banks
Industrial Advances
Credits to Foreign Central Banks
.
Building Operations of the Federal Reserve Banks
Federal Reserve Interdistrict Collection System
Agreements of Nonmember Banks Under Securities Exchange Act of 1934
Amendments to the Federal Reserve Act
Changes in Regulations of the Board of Governors
Regulation of the Federal Open Market Committee
Revised Form of Condition Report
Bank Examinations
,
Trust Powers of National Banks
Holding Company Affiliates
Foreign Banking Corporations
Foreign Branches of Member Banks
Meetings of the Federal Open Market Committee
Meetings of the Federal Advisory Council
Appointment of Ernest G. Draper as a Member of the Board of Governors
of the Federal Reserve System
Changes in Board Staff
Board Expenditures
*
Change in Form of Publication of Annual Report
......
.
22
25
27
29
32
32
33
33
33
34
34
35
36
36
36
39
39
40
40
41
41
in
41
41
41
42
TABLES
PAGE
No. 1. Statement of Condition of the Federal Reserve Banks (in Detail)
December 31, 1938
No. 2. Maturity Distribution of Bills and United States Government
Securities Held by Federal Reserve Banks
No. 3. Statement of Condition of Each Federal Reserve Bank at End of
1937 and 1938
No. 4. Volume of Operations in Principal Departments of Federal Reserve
Banks, 1934-1938
No. 5. Earnings and Expenses of Federal Reserve Banks During 1938
No. 6. Current Earnings, Current Expenses, and Net Earnings of Federal
Reserve Banks and Disposition of Net Earnings, 1914-1938
No. 7. Federal Reserve Bank Discount, Interest, and Commitment Rates
and Buying Rates on Acceptances
No. 8. Maximum Rates on Time Deposits
No. 9. Member Bank Reserve Requirements
,
No. 10. Member Bank Reserve Balances, Reserve Bank Credit, and Related
Items—End of Year 1918-1938 and End of Month 1938
No. 11. All Member Banks—Condition on September 28, 1938, by Classes
of Banks
No. 12. All Member Banks—Classification of Loans, Investments, and Capital Stock on September 28, 1938, by Classes of Banks
No. 13. Number of Banks and Branches in United States, 1933-1938
No. 14. Analysis of Changes in Number of Banks and Branches During 1938
No. 15. Money Rates, Bond Yields, and Stock Prices
No. 16. Business Indexes
45-46
47
48-51
53
54-55
56-57
58
59
60
61
62-63
64-65
66
67
68
69
APPENDIX
Record of Policy Actions—Board of Governors
73-75
Record of Policy Actions—Federal Open Market Committee
76-84
Recommendations of the Federal Advisory Council to the Board of Governors of the Federal Reserve System
85-86
Comparison of Some of the Federal Statutory Provisions Regulating the
Business of Different Classes of Banks
87-88
Revision in Bank Examination Procedure
89-90
Revised Regulation Issued by the Comptroller of the Currency on Purchases
of Investment Securities
91-93
Directory of the Board of Governors of the Federal Reserve System
94
Salaries of Officers and Employees of the Board of Governors of the Federal
Reserve System
95-99
Receipts and Disbursements of the Board of Governors of the Federal Reserve
System for the Year 1938
100
Statement of Expenses of the Board of Governors of the Federal Reserve
System, 1938
101
Directory of the Federal Open Market Committee
102
Directory of the Federal Advisory Council
103
Chairmen, Directors, Presidents and First Vice Presidents of Federal Reserve
Banks
104-107
Number and Salaries of Officers and Employees of Federal Reserve Banks. . 108
State Bank and Trust Company Members
109-117
Description of Federal Reserve Districts
117-122
Federal Reserve Branch Territories
123-124
Map of Federal Reserve Districts
125
LETTER OF TRANSMITTAL
BOARD OF GOVERNORS OF THE
FEDERAL RESERVE SYSTEM,
Washington, January 27, 1939.
THE SPEAKER OF THE HOUSE OF REPRESENTATIVES.
Pursuant to the requirements of section 10 of the Federal Reserve
Act, as amended, I have the honor to submit the Twenty-fifth Annual
Report, prepared by direction of the Board of Governors of the Federal
Reserve System, covering operations during the calendar year 1938.
Yours respectfully,
M. S. ECCLES, Chairman.
ANNUAL REPORT OF THE BOARD OF GOVERNORS OF THE
FEDERAL RESERVE SYSTEM
FOREWORD
The present, when our banking system is under no stress, is an appropriate time to present to Congress a picture of the banking problems of
today. The Board is convinced that it would be derelict in the discharge
of its responsibilities if it failed to call to the attention of Congress such
defects in our banking machinery, from the monetary, credit, and supervisory point of view, as still exist, notwithstanding the important improvements that have been made by Congress in recent years. This is
a necessary first step in preparing the ground for such further improvements, within the general framework of our State and national banking
systems, as Congress may deem advisable in order to enable the
banking mechanism better to withstand stresses and strains to which it
may be subjected in the future as it has been in the past. This report
is confined to a discussion of major problems in the banking field and
no attempt has been made to cover all the matters in this field that
require consideration at this time. The Board stands ready to offer all
the assistance in considering this subject that Congress may desire and
that the Board is able to contribute.
Banking is a business vested with a public interest. The current financial needs of commerce, industry, and agriculture are met largely through
the individual actions of the 15,000 separate banks in operation in this
country. The volume of their loans and investments has a direct relationship to the volume of business activity, and the deposits created by
these loans and investments, as they pass from hand to hand, are the
medium through which the bulk of the nation's payments are made.
Successful operation of our banking institutions is, therefore, necessary
to the orderly functioning of the nation's business. It is not merely the
concern of those who have invested their money in the banking business,
nor merely of those who have entrusted their deposits to the banks. It is
also a matter of public concern, both because of the importance of safeguarding deposits and because of the part that the banks play in maintaining the flow of goods and services through the channels of production
and distribution, from the farm, the forest, and the mine to the ultimate
consumer. Interference with the orderly functioning of banks, whether
through bank failures or otherwise, results in the elimination of an
2
ANNUAL REPORT OF BOARD OF GOVERNORS
habitual source of financial assistance on which the banks' customers
have relied, and in the loss or tying up of deposits belonging to the depositors who have made their business and personal plans in the assurance that they have this money at their disposal. The degree of eagerness
of banks to extend credit and their ability to do so have an important
influence on the course of business, because these factors result in an
expansion or a contraction of loans and investments, and in changes in
the volume of deposits, which are the country's principal medium of
exchange.
SUMMARY
Composition of the Banking System and Trends in Banking.—At the
present time our banking system, as considered in this report, consists
of about 15,000 banks. National banks, which are chartered by the
Federal Government, constitute about one-third of the number, and
nearly all the rest are chartered by the forty-eight State authorities. All
of the national banks and about 10 percent of the State banks are members of the Federal Reserve System, and these members hold 70 percent of total bank deposits and 85 percent of deposits at commercial
banks. All but about 1,500 banks are insured by the Federal Deposit
Insurance Corporation, which covers deposits up to $5,000 for each depositor. Of the total of approximately $60,000,000,000 of bank deposits
at the present time, 45 percent is at national banks, 25 percent
at State member banks, and the remainder at nonmember banks.
Although about 85 percent of all bank depositors are protected in whole
or in part by Federal deposit insurance, only about 38 percent of the
aggregate amount of deposits is covered.
Since 1921 the number of banks has been approximately cut in two,
principally by bank failures, which have resulted in losses to depositors
of over $2,000,000,000. While the amount of bank deposits at present is
larger than it has been at any previous time, and while in general the
country has ample and in some localities excessive banking facilities,
there may be some localities that do not have adequate banking service.
The nature of bank operations and the composition of bank assets
have been greatly changed in recent years. Commercial borrowing at
banks has declined. In the last decade, with the growth of the public
debt, securities of the United States Government have become an increasingly important part of bank portfolios and now constitute over
one-third of their total earning assets.
Public Supervision of Banks.—Its Growth and Pattern.—Recognition
of the public interest in banking is indicated by the fact that banks have
been subject to public supervision for nearly a hundred years. Banking
legislation, State and national, has reflected the cumulative results of
attempts by various governmental authorities to meet competitive conditions and specific situations and emergencies. As a consequence, the
FEDERAL RESERVE SYSTEM
3
development of the mechanism of supervision has been piecemeal in
character and not in accordance with comprehensive plans made with
reference to the country's banking needs taken as a whole. From this
process the banking picture emerges as a crazy quilt of conflicting powers
and jurisdictions, of overlapping authorities and gaps in authority, of
restrictions making it difficult for banks to serve their communities and
make a living, and of conditions making it next to impossible for public
authorities to apply adequate restraints at a time and in conditions when
this may be in the public interest. A chart showing the confusion of
jurisdictions under which the banks function appears on page 9.
Discriminations.—Different classes of banks are subject to different
laws and jurisdictions, and these differences in many cases constitute
competitive disadvantages, particularly for national banks and other
members of the Federal Reserve System. The Board of Governors and
the officers of the Federal Reserve banks strive to encourage eligible nonmember banks to become members of the Federal Reserve System, yet
there are provisions of law that tend to discourage membership since
they apply to member and not to nonmember banks. Among such provisions, for example, are those that restrict banks in charging exchange,
prescribe the minimum capital for the establishment of banks and
branches, establish requirements for reserves against deposits, and limit
the character of bank investments.1
Supervisory Responsibility Diffused.—Forty-eight State authorities
and the Federal Government share the responsibility for bank supervision. Within the Federal Government authority over the banks is scattered among several agencies. The Comptroller of the Currency has the
responsibility for the chartering and closing of national banks and the
primary responsibility for their examination and supervision. The Federal Reserve System has some degree of supervision over all member
banks, but in matters relating to national banks the primary responsibility is with the Comptroller, and in those pertaining to State member
banks it is with State supervisory authorities. The Federal Deposit
Insurance Corporation has definite responsibilities in regard to all insured banks? and exercises its supervisory powers particularly in the case
of insured banks which are not members of the Federal Reserve System.
The Treasury Department, under the emergency laws of 1933, still has
the responsibility for licensing member banks and for approval of the
purchase of bank stock by the Reconstruction Finance Corporation. This
Corporation, because of its authority to make loans to banks and to purchase preferred stock and debentures from them, has proprietary and
contractual powers of supervision over such banks as receive loans or
capital from the Corporation.
As a consequence of this diffusion of authority, the banks themselves
1
Provisions of law that also result in discrimination include restrictions on interlocking directorates,
on loans to officers, and on other matters discussed on pages 10 and 11.
4
ANNUAL REPORT OF BOARD OF GOVERNORS
are frequently confused about the agency with which they must deal and
by the variety of regulations. While cooperative arrangements have been
worked out among the various governmental agencies by which banks
are generally not subjected to separate examinations by more than one
authority, the power to examine banks is possessed by several agencies
and this power can be used. There are many regulations relating to
various banking operations, the responsibility for which is divided between several authorities. For example, the power to determine maximum rates of interest to be paid on time deposits is divided between the
Board of Governors of the Federal Reserve System and the Federal
Deposit Insurance Corporation. The same division exists in connection
with enforcement of the law prohibiting the paying of interest on demand
deposits. The power of granting and supervising the exercise of trust
powers by national banks is divided between the Board of Governors and
the Comptroller of the Currency. There are many other similar instances.
As a consequence of the diffusion of responsibility and diversity of
authority over the banks there is often uncertainty of decision and delay
in action where promptness is important in the public interest.
Problem of Uniformity in Examination Policy.—Diffusion of authority
has also been responsible for difficulties in establishing uniform policies
in connection with bank examinations. While a voluntary agreement has
been worked out between the three principal Federal supervisory agencies—the Comptroller of the Currency, the Federal Deposit Insurance
Corporation, and the Board of Governors—the permanence of this arrangement depends on continuous agreement between the agencies on the
policies involved, and its effectiveness depends on a uniform interpretation of the policies adopted. The interpretation, however, may vary
from time to time in accordance with the points of view of those responsible for the policies of the three agencies.
Relation Between Supervisory and Credit Policies.—The Board wishes
to raise a broad question as to the relationship that should exist between
general credit policies and policies pursued in the examination and supervision of banks. There have been times in the past when these policies
have worked in opposite directions, with a consequent aggravation of
deflationary and inflationary trends.
This report presents for consideration the problem whether and, if so,
by what method examination policies could be so harmonized with credit
policies as to become jointly a stabilizing force in the national economy.
Nature and Function of Bank Reserves.—The Federal Reserve System's power to influence credit conditions as an aid to greater economic
stability arises largely out of its ability to regulate the volume of member bank reserves. This subject was discussed at length in the Annual
Report for 1936.
To state it briefly, under our system member banks are obliged to keep
reserves in amounts equal to a definite proportion of their deposit lia-
FEDERAL RESERVE SYSTEM
0
bilities. Consequently, in order to extend more credit, a bank must have
reserves in excess of its existing requirements or be able to obtain such
reserves. By increasing or decreasing the amount of reserves available
to the banks, the Federal Reserve authorities may encourage or discourage the expansion of bank credit, particularly at times when the
banks have a limited amount of unused reserves. Changes in the amount
of unused reserves of member banks can be effected by the System
through purchases or sales of United States Government securities in
the open market, through discounts for member banks at the discount
rate, and through changes in reserve requirements.
Growth of Reserves in Recent Years.—Bank reserves, however, are
influenced also by developments over which the System has no control,
such as gold imports and issues of silver certificates by the Treasury.
Since the amount of money that remains in circulation is determined by
the people's habits and needs for cash and not by the amount of currency issued, currency of any kind issued not in direct response to current
needs of the public is deposited in the banks and is added to bank
reserves.
In considering the problems of credit regulation in the future, the
banking authorities are faced with the effects of the rapid growth of
bank reserves in recent years. In the five years from 1933 to 1938 this
growth has amounted to $6,000,000,000, due to additions to the gold
stock and the issuance of silver certificates by the Treasury. When gold
comes into the country and the Treasury purchases it, the funds thus
released by the Treasury come into possession of the banks and become
bank reserves, and when silver certificates are issued by the Treasury
this also adds an equivalent amount to the reserves of member banks.
The amount of reserves needed by banks has been augmented by the
increase in reserve requirements and by the growth in deposits, but their
reserves now exceed requirements by $3,600^000,000. This amount of excess reserves can be more than doubled, even without further gold imports or silver purchases, through disbursement by the Treasury of
amounts equivalent to the gold it holds in the Stabilization Fund and
elsewhere, by a reduction of its unusually large balances with the Federal Reserve banks, and by the issuance of silver certificates against the
free silver bullion now in the Treasury's possession. This leaves out of
consideration the Treasury's authority to issue United States notes. The
Treasury can also absorb member bank reserves by increasing its cash
holdings and its Federal Reserve balances. Under existing conditions
the Treasury's powers to influence member bank reserves outweigh
those possessed by the Federal Reserve System.
System's Powers to Control Excess Reserves.—Under the present law
the Federal Reserve System can absorb excess reserves only to the extent
of approximately $800,000,000, the amount by which it can increase
b
ANNUAL REPORT OF BOARD OF GOVERNORS
member bank reserve requirements, and the additional amounts that
could be taken up by such sales out of its portfolio of $2,560,000,000 of
Government securities as may be in the public interest. After the System had done all in its power to absorb excess reserves, a considerable
amount would remain at the disposal of the banks. In view of the
many changes in bank assets and in money market conditions that have
occurred in recent years, only experience can determine at what level
of excess reserves banks will be responsive to Federal Reserve policy.
It is clear, however, that the present and prospective volume of excess
reserves may at some time become the basis of an injurious credit expansion. If this should develop, the Federal Reserve System with its
present powers might not be in a position to carry out the mandate of
Congress to prevent such an expansion.
The Board is convinced that there is no immediate prospect of excessive expansion of bank credit and no reason to change the present
policy of monetary ease adopted for the purpose of facilitating recovery.
It believes, however, that the present is an appropriate time to review
our banking, credit, and monetary system in order that Congress may
consider such changes and improvements as appear desirable.
THE BANKING SYSTEM TODAY
Composition of the Banking System.—A brief statement about the
number and size of the different types of banks that exist today, and the
changes that have occurred in recent years in the character of the banking business, will supply a background for the banking picture with
reference to which banking laws and banking administration will be
considered in this report.
Our banking system is the result of an evolutionary development. At
the time of the passage of the National Bank Act in 1863, all incorporated banks were under State authority. After establishment of the
national banking system, supervision of a large part of the country's
commercial banking resources passed to the Federal Government. Upon
this composite structure of national and State banks was superimposed
in 1913 the Federal Reserve System, which extended Federal supervision
to such State banks as joined the System. In 1933 the organization of
the Federal Deposit Insurance Corporation extended Federal supervision
to all banks having Federal insurance of deposits.
The number and deposits of the principal groups of banks as of
June 30, 1938, are shown in the following table. The total includes all
commercial banks and trust companies in the United States and some
private banks, as well as mutual and stock savings banks and a few
so-called industrial banks. The figures do not include institutions which
may engage in some banking operations but which are not generally considered as being primarily banks. For example, security brokers, land
FEDERAL RESERVE SYSTEM
BANKING STRUCTURE OF THE UNITED STATES
June 30, 1938
Number
banks
All banks
Insured banks:
National
State member
Insured nonmember
Noninsured banks
1
Gross
deposits 1
(in millions
of dollars)
Percent of total
Number
of
banks
Deposits
15,287
59,044
100
100
5,242
1,096
7,437
1,512
26,763
14,546
7,123
10,612
34
7
49
10
45
25
12
18
Include interbank deposits.
banks, building and savings and loan associations, mortgage companies,
finance companies, and credit agencies owned in whole or in part by the
Federal Government are not included.
In this table, so arranged as to show the four principal groups of
banks from the supervisory point of view, the first two groups together
comprise all member banks of the Federal Reserve System, and the first
three together all represent banks insured by the Federal Deposit Insurance Corporation. The table shows that 41 percent of all banks are
members of the Federal Reserve System, that they hold 70 percent of
deposits, that 90 percent of all banks are insured, and that these insured-banks hold 82 percent of all deposits. Of the total amount of
bank deposits about 38 percent is covered by Federal deposit insurance.
Ten percent of the banks with 18 percent of deposits are noninsured
banks. Most of the deposits of noninsured banks are in about 600
mutual savings and private banks. Leaving these out, all but 900 commercial banks with $900,000,000 of deposits are covered by Federal deposit insurance.
The number of banks in operation at present is only about one-half
as large as in 1921. Through failures and consolidations the number of
banks has been reduced from 30,000 to 15,000. The banks which suspended held deposits of about $8,500,000,000, of w7hich about one-fourth
has been lost to depositors. The aggregate volume of deposits of the
banking system, however, has generally grown, except in the three years
from 1930 to 1933, and at the end of 1938 was larger than at any previous time.
Changes in Character of Banking.—The character of the banking
business has undergone considerable change in the past twenty years.
Increasing use of the corporate form of business enterprise, together with
the growth in the importance of large concerns and in the custom of
meeting corporate financial needs through security issues or out of retained earnings, has resulted in a decline in the extent to which business
o
ANNUAL REPORT OF BOARD OF GOVERNORS
relies upon banks for commercial loans. There has also been in recent
years an increase in the amount of savings deposited in banks, which has
placed on the banks the responsibility for the investment of these funds.
During recent years, with the decrease in demand for commercial loans
and the increase in funds held by banks, there has been a pronounced
change in the nature of bank assets. Holdings of Government and other
securities and loans on real estate have increased, while commercial
loans have diminished in importance. Banks have been forced to find
outlets for the funds through channels other than those which were
customary in former days and this has been reflected in revisions of
banking laws relating to mortgages, of regulations applicable to bank
investments, and a liberalization of the basis of borrowing from the
Federal Reserve banks.
Laws and Jurisdictions to Which Banks Are Subject.—As has been
pointed out above, the banks of the country, viewed in relation to the
laws and supervisory authorities to which they are subject, can be divided
into four groups: (1) National banks; (2) State bank members of the
Federal Reserve System; (3) Nonmember State banks covered by Federal deposit insurance; and (4) Noninsured State banks. Of these four
groups of banks the first three are covered by Federal deposit insurance.
The network of laws and regulations to which these banks are subject is
illustrated by the chart on page 9.
Summarizing the matter briefly, and in reverse order, noninsured State
banks are subject to only a few Federal banking laws and are almost
entirely controlled by State laws and authorities.
Insured nonmember banks are subject to State laws and to such
Federal banking laws as apply to all banks whose deposits are covered
in whole or in part by Federal deposit insurance.
State bank members of the Federal Reserve System are subject to
three sets of laws: State laws; Federal laws connected with Federal
deposit insurance; and other Federal laws applicable to members of the
Federal Reserve System.
National banks are governed by Federal banking laws, some applicable to them as banks chartered by the Federal Government, some as
members of the Federal Reserve System, and some because they are
insured by the Federal Deposit Insurance Corporation.
Out of this complicated network of independent laws and overlapping
jurisdictions and authorities arise many discriminations against one or
another group of banks. When national laws are compared with State
laws the comparison has to be made with 48 different sets of laws. It
is obvious that such a comparison cannot be made in detail within the
scope of this report. Some of the outstanding differences between the
various laws in effect have to do with capital requirements for the organization of banks, with the character of loans and investments permitted, with amounts permissible to be loaned to an individual, with
PRINCIPAL BANK SUPERVISORY RELATIONSHIPS
FEDERAL GOVERNMENT
48 STATES
STATE BANK
SUPERVISORY AUTHORITIES
F. R. SYSTEM
TREASURY
BOARD OF GOVERNORS
FEDERAL
DEPOSIT
INSURANCE
CORPORATION
COMPTROLLER
OF THE
CURRENCY
RECONSTRUCTION
FINANCE
CORPORATION
FISCAL POLICY OPEN MARKET
OPERATIONS
GOLD AND
SILVER POLICY
RESERVE
REQUIREMENTS
STABILIZATION
FUND
OPERATIONS
REDISCOUNT
POLICY
rized
ir
( MEMBERS)
STATE MEMBER BANKS
7>it Reports
1
jsits Insured
o
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-o
1
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cise of Trus
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Sell Co pital 1
Borrow from
cr
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uire
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XI
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Submit Repor
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Examin
License
Charter ed by
NATIONAL BANKS
XI
1
jog
• INCIDENTAL RELATIONSHIPS
s
bay s
• MAJOR RELATIONSHIPS
•X3
Exercise of Tr ust
Deposit s Insur
S
o
>.
o
TJ
N
a>
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n
ons c
Aut
"1
Borr ow from
Sell Capita! Issu
S
INSURED NONMEMBER
BANKS
NON1NSURED BANKS
10
ANNUAL REPORT OF BOARD OF GOVERNORS
the establishment of brandies, and with the charging of exchange on
checks.
Discriminatory Federal Laws.—Some of the principal laws that result
in competitive advantages for one group of banks as compared with the
others may be mentioned. The statements refer only to discriminations
in the Federal laws between member banks and nonmember insured
banks. There may be cases where laws in some States provide for restrictions on State banks similar to those imposed by Federal laws on member banks.
Member banks are required by statute to remit at par to the Federal
Reserve bank for all checks drawn against the member bank and collected through the Federal Reserve bank. Nonmember banks can make
exchange charges on checks forwarded to them for collection. In many
cases such exchange charges constitute an important source of revenue
for small banks.
Member banks are required to have a fixed minimum capital in accordance with the size of the town in which they are located, while
for insured nonmember banks there is no fixed Federal requirement
and each case is considered on its merits by the Federal Deposit Insurance Corporation. There is also an important discrimination against
member banks in the matter of capital requirements in connection with
authority to establish branches.
Member banks must keep wTith the Reserve banks reserve balances
against their deposit liabilities in proportions determined by the Federal
Reserve Act and the Board of Governors, while nonmember banks are
governed in this matter by State laws which in most cases require
smaller reserves.
The character of investments eligible for purchase by member banks
is subject to Federal regulation while nonmember banks are not subject
to this particular regulation.
Provisions in the Clayton Act which regulate and restrict the service
of persons in various capacities in more than one bank with a view to
preventing concentration of banking power are applicable to member
banks but not to nonmember banks. In view of the fact that obtaining
the services of influential and capable directors is an important and a
difficult task for banks, the greater freedom of choice in this respect
possessed by nonmember banks works to the disadvantage of membership in the System.
Member banks are subject to many restrictions and regulations, not
applicable to other banks, in respect to the affiliates with which they
may be connected. This is a matter of importance principally in connection with membership in banking groups controlled by holding
companies.
Member banks, but not other banks, are also subject to Federal laws
by authority of which officers and directors may be removed by the
FEDERAL RESERVE SYSTEM
11
Board of Governors in cases of continued violation of law or continued
unsafe or unsound practices. This provision of law was designed to
strengthen the hand of supervisory authorities in promoting sound banking conditions, short of taking steps that would result in the suspension
of the bank.
Member banks, but not other banks, are subject to Federal restrictions
and limitations regarding loans to officers.
A list of all Federal statutory provisions that do not apply uniformly
to all banks subject to Federal supervision is too lengthy for the report.
A partial list appears in the Appendix on page 87.
The application of some of these laws singly or in combination tends
to discourage membership in the Federal Reserve System. Specific instances have come to the attention of the Board of Governors during the
past year.
A number of national banks have recently surrendered their national
charters and taken State charters because they can operate branches with
less capital under State law; a number of State banks which desire to
join the Federal Reserve System have been prevented from doing so
because they have branches and do not have the capital required by Federal law for the operation of branches by State member banks; and a
number of banks have threatened to withdraw from the System rather
than give up valued directors because of the provisions of the Clayton
Act. Many State banks in the Mississippi Valley and the South Atlantic
States refrain from joining the Federal Reserve System because members
of the System are required to be members of the par clearance system
while nonmember banks may deduct exchange charges. There have been
withdrawals from the Federal Reserve System for which the same reason
was given.
These are but a few illustrations of the many ways in which the Federal banking laws discourage membership in the Federal Reserve System
and encourage banks to continue to operate as nonmember banks.
BANK SUPERVISION
Allocations of Authority.—Not only do laws regulating bank operations differ for different groups of banks, but banks are also subject to
a number of different supervisory authorities and to diverse regulations
issued and enforced by such authorities.
Supervision and regulation of banks differ materially from State to
State as well as between banks that are chartered by States and those
that are chartered by the Federal Government. Even within the Federal
Government there is extensive diversity, overlapping, and confusion of
jurisdiction in the regulation and supervision of different groups of banks.
There are five Federal agencies engaged in bank supervision. Prior to
1933, Federal supervision of the commercial banking system, in so far as
it was subject to such supervision, was in the hands of the Comptroller
12
ANNUAL REPORT OF BOARD OF GOVERNORS
of the Currency and the Federal Reserve Board. Since 1933 there has
been added the Federal Deposit Insurance Corporation, which exercises
broad supervisory powers. Certain powers of the Reconstruction Finance
Corporation also give it a measure of responsibility for the operation of
banks, and the Secretary of the Treasury, through the exercise of authority under the President's emergency powers, licenses the operation of
member banks and has authority to exercise other regulatory powers.
Broadly speaking, the function of the Comptroller of the Currency is
to charter and supervise national banks and, when necessary, to appoint
conservators or to close and supervise the liquidation of national banks.
When the Comptroller closes a bank, however, on account of its inability
to meet the demands of its depositors, he is required to appoint the Federal Deposit Insurance Corporation as receiver.
The Federal Reserve System has authority to supervise and examine
all banks that are members of the System and to lay down requirements
for admission of State banks to membership. But in relation to national
banks its authority is parallel to a considerable extent with that of the
Comptroller of the Currency, and in regard to State banks with those of
State supervisory authorities. When banks receive national charters from
the Comptroller, they become members of the Federal Reserve System,
without any action by the Board of Governors, and State banks, while
they can join the System only with its approval, bring with them charter
rights obtained from State authorities.
The supervisory functions of the Federal Deposit Insurance Corporation revolve around the insurance of deposits of banks that are insured
and the termination of this insurance. Supervisory functions of the Federal Deposit Insurance Corporation relating to State insured banks
parallel to some extent the functions exercised by State authorities and
as to national banks and State member banks duplicate to some extent
the functions of the Comptroller of the Currency and the Federal Reserve System. National banks chartered by the Comptroller of the
Currency and State banks admitted to membership in the Federal Reserve System are all insured by the Federal Deposit Insurance Corporation.
The supervisory activities of the Reconstruction Finance Corporation
occur in connection with the purchase and ownership of preferred stock
and capital notes and debentures of banks. These activities are not
based directly on legal requirements but indirectly on the proprietary
and contractual relationships between the Corporation and the banks.
Confusion and Conflict of Authority.—In many matters there are
divisions of authority, both in the law vesting the authority and in its
exercise.
For instance, the Comptroller of the Currency issues regulations defining and governing the purchase of investment securities by national
banks. The regulations, however, are applicable also to State member
FEDERAL RESERVE SYSTEM
13
banks but not to insured nonmember banks. The Comptroller of the
Currency enforces the regulations with respect to national banks and
the Reserve System enforces them with respect to State member banks.
A similar situation exists in relation to the exercise of trust powers
by national banks. Authority to grant trust powers and to issue regulations rests with the Board of Governors. Supervision over the exercise
of these powers and over compliance with these regulations, however, is
in the hands of the Comptroller of the Currency.
Confusion and conflict of authority exist also in the matter of regulation of interest to be paid by banks on deposits. Payment of interest on
demand deposits is prohibited for all insured banks, including national
banks, State member banks, and insured nonmember banks. This would
appear to be a simple matter. But application of the definition of interest to particular cases is not simple and has many implications. It has,
for example, an important bearing on the practice of city banks in
absorbing expenses and exchange charges on items collected for country
correspondents in return for the maintenance of balances. There is,
however, no single authority having power to administer this law. In
regard to member banks it is administered by the Board of Governors
and in regard to nonmember insured banks by the Federal Deposit Insurance Corporation. The Federal Deposit Insurance Corporation enforces
its own regulation, but the Board's regulation, in so far as it applies to
national banks, is administered by the Comptroller of the Currency.
Determination of the maximum rate of interest to be paid on time
deposits is made for member banks by the Board of Governors and for
nonmember insured banks by the Federal Deposit Insurance Corporation.
The Federal Reserve System is charged with the administration of
the law regarding holding company affiliates of member banks; but the
same holding company sometimes controls national banks supervised
primarily by the Comptroller of the Currency, State member banks supervised principally by the States and the Federal Reserve System,
nonmember insured banks supervised principally by the States and the
Federal Deposit Insurance Corporation, and non-banking corporations
which are required to submit to examinations and to furnish reports of
condition to the Federal Reserve System or the Comptroller of the Currency but usually are not subjected to any further supervision by bank
supervisory agencies. Such situations involve additional overlapping,
conflicts, and gaps in authority.
The conflicts of authority in bank supervision cause much confusion
and delay and not infrequently prevent prompt action in cases where
quick decision is necessary to prevent losses to the public and to remedy
critical situations.
In one case, for example, an excessively long period of time elapsed
between initiation of negotiations and the final consummation of a plan
14
ANNUAL REPORT OF BOARD OF GOVERNORS
fQr the relief of a dangerous banking situation in an overbanked community in which were located two State member banks and a national
bank, all in an unsatisfactory condition. The lapse of time was largely
due to the fact that the plan for working out the situation had to be
satisfactory not only to the local interests and to the State banking
authorities, but to the following Federal agencies: the Reconstruction
Finance Corporation, which purchased preferred stock in the new bank
organized to succeed the three; the Secretary of the Treasury, who had
first to request the Reconstruction Finance Corporation to subscribe to
the preferred stock and then had to license the new bank; the Federal
Deposit Insurance Corporation, which made a loan to the national bank;
the Comptroller of the Currency, whose cooperation was necessary in
order that the national bank might be included in the program; and the
Federal Reserve bank of the district and the Board of Governors, in
connection with the admission of the new bank to membership in the
System. Officials and examiners of all these agencies were participants in
numerous conferences, both at Washington and in the field.
In the case of another national bank, while the Federal Deposit Insurance Corporation was preparing to institute proceedings to terminate
the bank's insurance, which might be expected to end in the appointment
of the Federal Deposit Insurance Corporation as receiver, the Comptroller of the Currency filed a certificate with the Board of Governors
instituting proceedings against the president of the bank to remove him
from office under authority granted by the Banking Act of 1933. The
Board then initiated a hearing but, while this proceeding was under way,
the Comptroller of the Currency found it necessary to appoint a conservator. After the conservator was appointed, the Board proceedings
were concluded and the president of the bank was removed from office.
Subsequently the conservator was supplanted by the Federal Deposit
Insurance Corporation as receiver.
There are cases of banks threatening to give up national charters in
order to escape regulation and supervision by the Comptroller of the
Currency; of other banks threatening to retire from the Federal Reserve
System in order to escape regulation and supervision by the Reserve
System; and of still other banks threatening to join the Federal Reserve System in order to escape some requirements or conditions imposed
by the Federal Deposit Insurance Corporation.
In practice there is less confusion in many of the supervisory activities
of the Comptroller of the Currency, the Federal Reserve System, and
the Federal Deposit Insurance Corporation than in the authority under
which these agencies act. Bank examinations are an example. Generally
speaking, national banks are examined only by the Comptroller of the
Currency; the Federal Reserve System has power to examine all member
banks but does not examine national banks and examines State member
banks in cooperation with State authorities, and State member banks
FEDERAL RESERVE SYSTEM
15
are not examined by either the Comptroller of the Currency or the Federal Deposit Insurance Corporation; the Federal Deposit Insurance Corporation in cooperation with State authorities examines the insured State
banks which are not members of the Reserve System. The Federal
Deposit Insurance Corporation has power to examine national banks,
with the permission of the Comptroller of the Currency, and State member banks, with the permission of the Board of Governors. Such examinations, however, are seldom made. State banks belonging to the
Reserve System and insured nonmember banks are examined by Federal,
as well as by State, authorities but the extent of duplication in this
respect is reduced through arrangements for joint or alternating examinations. In practice, therefore, the effect of these conflicting authorities
to examine banks has been minimized by agreement by which the Federal agencies accept each other's examinations, but the authority, nevertheless, exists and can be used.
Somewhat the same situation exists as regards condition, dividend,
and other reports, and their publication. The Comptroller of the Currency, the Federal Deposit Insurance Corporation, and the Reserve
System all have powers and responsibilities in this field. They all maintain, in addition to examination departments, statistical organizations,
and here again only agreements moderate the bad effects of duplicate
and conflicting requirements.
While duplication in reports and examinations by different Federal
agencies is largely avoided by cooperative arrangements, nevertheless
delays and difficulties arise from the overlapping of responsibility. Even
after an agreement is reached, there may be, and in fact, there are, differences of interpretation of the procedure, formula, or policy agreed
upon.
For example, after lengthy negotiations a voluntary agreement between the agencies in connection with examination policy was reached
last summer.1 The effectiveness of this agreement, however, depends, in
the first place, on the continuance of cooperation between the agencies
and, in the second place, on the nature of interpretations placed by the
different agencies on the agreed principles of examination. A similarity
of interpretation is difficult to attain because the agencies have different
responsibilities and, therefore, different approaches to the problem. The
Comptroller of the Currency is primarily a supervisory and examining
agency and is interested principally in matters affecting the status of
individual banks. The Federal Deposit Insurance Corporation is primarily an insurance agency and is, therefore, primarily concerned about
the protection of the insurance fund. The Board of Governors, in addition to its supervisory responsibilities, is concerned with national credit
and monetary policies, and is, therefore, interested in supervisory policies
1
See pages 37 and
16
ANNUAL REPORT OF BOARD OF GOVERNORS
that are in conformity with credit policies. Such policies must look not
only to the status of individual banks and the safeguarding of the interests of depositors, but also to the maintenance of sound credit conditions
in the aggregate and a sound banking system, without which credit
policies cannot be effectively put into operation.
While the ultimate objective of all the agencies concerned is a sound
banking condition and an unimpeded flow of funds to finance commerce,
industry, and agriculture, the different points of approach to the problem
by the different agencies inevitably lead to differences in emphasis in the
interpretation of principles of policy.
RELATION BETWEEN SUPERVISORY AND CREDIT POLICIES
The agreement upon examination procedure which has been mentioned
marks a cooperative forward step by the agencies concerned. The fundamental question as to what should be the relationship between the administration of national credit policies and of bank examination and
supervision, however, still remains and is of so vital importance as to
deserve careful consideration by Congress.
Criticism has been directed in recent years at supervising authorities
for the influence they have exercised towards the curtailment of credit
at times when such curtailment has been contrary to prevailing national
credit policies and has tended to retard economic recovery. There are
wide differences of opinion on this subject and it deserves full and fair
exploration and consideration.
Some of the questions that may be considered in this connection are
here presented:
What effect does bank supervision have on changes in the outstanding volume of bank credit?
W^hat influence do examinations have on the expansion or contraction of credit during the different phases of the business cycle?
Should examination policy be so directed as to contribute to the
protection of the general economy from the effects of undue expansion or contraction of credit?
What distinction, if any, exists between the considerations upon
which a sound national credit policy should be based and the measures that should be taken to insure the soundness of individual
banks?
Is harmony between examination policies and credit policies necessary to the discharge of the responsibilities of the agencies vested
with authority to determine these policies?
Consideration should be given to the question whether examiners'
appraisals of loans and investments based on current conditions and
market quotations may at times accelerate the downward spiral of a
depression or delay recovery; also whether at other times examiners,
FEDERAL RESERVE SYSTEM
17
in passing on loans which may be currently collectible, fail to take into
consideration the existence of a tendency towards unsound credit conditions and to exert a restraining influence on boom conditions. This may
result from the fact that in a period of decline current quotations may
merely reflect the temporary absence of a fair market, and may understate intrinsic values, while in a boom period market quotations may
reflect speculative expectations rather than true values.
May efforts of supervisory agencies to produce increased bank liquidity at times of low business activity and depressed markets have unanticipated and unintended adverse effects upon the local community,
and may these local effects, when aggregated, exert'a general deflationary
influence on business and credit conditions in the country as a whole?
In considering relationships between examination policies and general
credit policies, it would be desirable to determine whether bank supervisory authorities should exert their influence to encourage extension of
sound credit by banks at times when they have funds available and
when such extension of credit may be helpful to the national economy;
and, on the other hand, whether at times of unduly rapid growth of bank
credit the influence of these agencies should be exerted to discourage
banks from freely making loans, even of the kinds that ordinarily could
be made with apparent safety by a particular bank. This question involves consideration of the relationship between the extension of credit
at certain times by particular banks and the broader and longer-range
problem of nationwide credit expansion.
Consideration might also be given to the possible effect on the general
economy of rigid definitions of the character of loans and investments
that may be made by banks. May such definitions cause unnecessary
liquidation at certain times and result in the holding of idle funds at
other times? Has the problem of definition of assets that banks may
acquire been affected by changes that have been made in recent years
in the laws, regulations, and conditions governing assets on which banks
can borrow from the Federal Reserve banks? Can agencies charged with
the responsibility of determining general policies that affect the extension of credit by banks discharge this responsibility unless examinations, which affect the policies and practices of individual banks, are in
harmony with these general credit policies?
The bank examiner in the field deals with local situations. He attempts to appraise assets in the light of such information as is available
to him and values must be determined in many cases by local conditions.
These conditions may relate to the position of the particular bank being
examined or of the particular community. It is a problem of great complexity to find means by which this local procedure, when multiplied by
the thousands of banks throughout the country, can be brought into conformity with national policies.
Can the examination policies of the several Federal supervisory agen-
18
ANNUAL REPORT OF BOARD OF GOVERNORS
cies be further coordinated to promote effective functioning of the entire
banking system, making it a force toward increased national economic
stability? Furthermore, can the responsibilities vested in the Federal
agencies and the agencies of the 48 States charged with the examination
and supervision of their respective State banks also be properly coordinated to the same end?
It seems hardly possible to consider any of these questions singly. If
they are considered as a whole and studied in the light of the past
history of bank examination, of existing banking and credit conditions,
and of the objectives to be sought, answers should be found which will
go far toward producing a sounder and more flexible banking system.
THE PROBLEM OF RESERVES
Reserves and Credit Regulation.—The Federal Reserve System's power
to influence the volume and cost of bank credit arises largely out of its
authority over member bank reserves.
Under our system member banks are obliged to keep an amount equal
to a prescribed proportion of their deposit liabilities in the form of reserve balances with the Federal Reserve banks. Reserve requirements
for nonmember banks are determined by State authorities and are generally lower in effect than those prescribed for member banks. In order to
extend more credit without themselves borrowing, member banks must
have reserves in excess of their legal requirements. By increasing or
decreasing the amount of reserves available to the banks, therefore, the
Federal Reserve System can encourage or discourage the expansion of
bank credit and bank deposits, particularly at a time when banks have
little or no unused reserves. For a complete exposition of the functions
of reserves and of reserve requirements, reference is made to the Board's
Annual Report for 1936.
The usual situation in years gone by, when the pressure for credit
expansion was considerable and the volume of reserves limited, was for
the banks generally to have no reserves in excess of legal requirements.
In other words the banks were at all times practically loaned up. An
aggregate increase in their loans and investments, therefore, involved
borrowing from the Federal Reserve banks in order to acquire additional
reserves. When the banks are borrowing, they are less willing to make
loans and they become subject to the discount rate and to other measures
of regulation of their operations under provisions of the Federal Reserve
Act. When the System wished to encourage the expansion of bank credit,
it could take the initiative in increasing bank reserves by buying Government securities in the open market, which would place at the disposal
of banks funds with which to pay off debt at the Reserve banks or to
expand their own credit. On the other hand, when the System wished
to restrain expansion, it could sell Government securities, thereby taking
money out of the market and reducing reserves to the point where banks
FEDERAL RESERVE SYSTEM
19
would have to borrow in order to expand. By further sales the System
could reduce member bank reserves even below the amount needed to
maintain the existing aggregate volume of loans and investments, and
put the banks in a position of having the alternative of borrowing from
the Reserve banks or contracting their loans and investments.
This was the main line of action in encouragement and restraint as
long as the banks did not have a volume of reserves far in excess of
their current needs. In recent years banks have had continuously a large
amount of excess reserves. This is true at present, notwithstanding the
fact that, in accordance with authority under the Banking Act of 1935,
reserve requirements have been increased by approximately 75 percent
above the percentages stated in the statute.
The entire technique of influencing changes in the volume of bank
credit needs to be reconsidered in the light of changed banking and
money market conditions. It is probable that the increased importance
of holdings of Government securities and the shrinkage of the Streetloan account, through which individual banks were in the habit of making adjustments in their position in response to changing commercial
demands, as well as other changes in the situation, have made the banking system more responsive than formerly to measures of restraint. One
influence in this direction would come from the fact that sales of Government securities by the Reserve System, in addition to their effects on
bank reserves, would have a direct effect on the capital market of which
these securities now constitute an important part. The large holdings
by the banks of such securities make the banks more sensitive to changes
in bond prices. For these reasons it may not prove necessary in the
future, as it has been in the past, for banks to be without excess reserves and actually to be borrowing from the Reserve banks in order to
make them responsive to restraining influences.
Only experience can determine to what extent these changes in conditions have altered the effectiveness of existing methods of regulation.
There is no doubt, however, that such a volume of excess reserves as is
held by the banks today and as is likely to be at their disposal in the
near future presents an important problem to the country's credit and
monetary authorities.
Sources of Reserves.—Since the end of 1933 reserve balances of member banks have increased three-fold and at the end of 1938 totaled
$8,700,000,000, of which $3,200,000,000 were excess reserves. As shown
in the table, this growth in reserves has been due principally to the
extraordinary inflow of gold from abroad. The country's monetary gold
stock in dollars has increased during the five years by $10,500,000,000,
of which $2,800,000,000 represents the effect of revaluation and $7/700,000,000 additions of new gold from abroad and from domestic mines.
A portion of this additional gold is still held by the Treasury in the
20
ANNUAL REPORT OF BOARD OF GOVERNORS
Stabilization Fund and otherwise and some of it was used to retire national bank notes in a manner that did not add to member bank reserves.
FACTORS OF CHANGE IN MEMBER BANK RESERVES
December 30, 1933, to December 31, 1938
(Approximate figures, in millions of dollars)
Additions due to:
Gold operations
7,422
Issue of silver certificates
'.
1,221
Total additions
8,643
Deductions due to increase in money in circulation, growth in Treasury and
nonmember deposits at Federal Reserve banks, etc
2,648
Total increase in member bank reserves
Increase in required reserves due to:
Increase in percentage requirements
Increase in member bank deposits
Increase in excess reserves
Changes in reserve position from December 30, 1933, to December 31. 1938:
Total reserves
Increased from 2,729 to
Required reserves
Increased from 1,870 to
Excess reserves
Increased from 859 to
5,995
2,342
1,307
2,346
8,724
5,519
3,205
Of the inflow of gold from abroad, about two-thirds has resulted
from the movement of foreign capital to the United States. Large and
erratic movements of floating capital from country to country at a time
of political uncertainty and financial disorganization have been one of
the most disturbing factors in the financial fabric of post-war years.
Such movements are not like capital movements for long-term investment or seasonal movements in connection with foreign trade, nor like
movements in response to differences in interest rates, which have long
been a part of the international financial mechanism. Large and
sudden capital withdrawals tend to cause contraction of credit and
to retard business activity in the country from which the capital is
withdrawn. At the other end, accumulation of foreign funds in the money
market which appears for the time to offer the best security or the
greatest opportunity for profit is disturbing to the monetary and credit
systems of the country where this market is located. These movements
accentuate speculative changes in the security market and create either
a condition of artificial monetary ease or the need of absorbing excess
reserves at public or private expense. International capital movements
account for the greater part of the reserve problem with which this
country has to contend.
In addition to the gold inflow another source of reserves amounting
to $1,200,000,000 has been the issuance by the Treasury of silver coin
and certificates in connection with domestic and foreign silver purchases.
Additions to member bank reserves from the above sources have been
absorbed to the extent of $2,600,000,000 by increases in the demand for
currency and through growth of Treasury and nonmember bank deposits
at the Federal Reserve banks.
FEDERAL RESERVE SYSTEM
21
As a net result of all these developments and transactions, $6,000,000,000 was added to member bank reserves in the five years 1934-1938.
Of this amount $3,650,000,000 was absorbed by increases in required
reserves, due both to the increase in the prescribed ratios of reserves to
deposits and to the growth in the banks' deposit liabilities. Excess
reserves of member banks increased by $2,350,000,000 and at the end
of 1938 were $3,200,000,000. In the early weeks of 1939, with a return
flow of currency from circulation and a decline in Treasury balances,
excess reserves increased to $3,600,000,000. A continuation of gold inflow
and of silver purchases would further add to excess reserves.
The volume of excess reserves now in existence, furthermore, can be
greatly increased by actions of the United States Treasury. By disbursements of funds equivalent to the gold held in the Stabilization
Fund and elsewhere, by reduction of its unusually large balances with the
Federal Reserve banks, and by the use of its authority to issue silver
certificates against silver bullion now in its possession, the Treasury
could more than double existing excess reserves of member banks. In
addition, the Treasury has authority to issue up to $3,000,000,000 of
United States notes which would also be added to member bank reserves.
The Treasury also has power to absorb member bank reserves; it can
do so by increasing its cash holdings and Federal Reserve balances. With
these powers and the general gold and silver policies in the hands of
the Treasury, its power to influence the volume of member bank reserves
under existing conditions outweighs that of the Federal Reserve System.
Long-view Problem Raised by Excess Reserves.—In considering the
problem of reserves at this time the Board wishes to emphasize that the
long-view problem created by the existing large volume of bank deposits
and bank reserves is distinct from the immediate problem of making
ample bank credit available for the expansion of business from current
levels.
In recent years it has been the policy of the Government and of the
Federal Reserve System to encourage the expansion of credit. This has
constituted the so-called policy of monetary ease, which has been directed at keeping banks supplied with an abundant volume of reserves,
so as to encourage them to expand their loans and investments. This
policy has been one of the factors in the creation of the existing large
volume of deposits in the hands of business enterprises and of individual
and corporate investors, and has resulted in reducing interest rates to
the lowest level in history. It has been reflected in a decline in the carrying charges on mortgage debt for farmers and urban householders, has
enabled many corporations to refund their debt at lower rates, and has
lightened the cost of current financing to commerce, industry, and
agriculture.
Nor is there any immediate reason for considering a reversal of this
22
ANNUAL REPORT OF BOARD OF GOVERNORS
policy. There is nothing in the present monetary or banking situation
that would point to a proximate danger of injurious credit expansion. It is
in such a period as this, however, when there is no call for quick action
to meet emergency situations, that problems that may arise in the future
should be analyzed and the efficiency of existing machinery appraised.
It is from this point of view that the System's existing powers to
absorb excess reserves should be considered. Member banks at present
have excess reserves of $3,600,000,000, and this total may be doubled in
the future. To absorb these reserves the System has the power to raise
reserve requirements by $800,000,000 and to make sales out of its portfolio of United States Government obligations, which amounts to $2,560,000,000. The use of these available means of absorbing reserves, to the
extent that it may be in the public interest to do so, would still leave
the banks with a volume of excess reserves upon which it would be possible for an injurious credit expansion to develop.
The ability of the banks greatly to expand the volume of their credit
without resort to the Federal Reserve banks would make it possible for
a speculative situation to get under way that would be beyond the power
of the System to check or control. The Reserve System would, therefore,
be unable to discharge the responsibility placed upon it by Congress or
to perform the service that the country rightly expects from it.
In view of this situation the Board has deemed it its duty to point
out to Congress the present and prospective reserve position of our banking system and the limitations on the powers of the System to regulate it.
COURSE OF BUSINESS IN 1938
Business activity, which had declined sharply in the latter part of
1937, recovered considerably in 1938. Early in the year, while output
in some lines was still declining, residential building started to increase,
and about the middle of the year industrial activity generally began a
rapid advance that continued until the end of the year. The decline in
national income had not been so sharp as that in industrial production,
and during most of 1938 consumption was at a more rapid rate than
production. As a consequence, inventories of industrial products which
had accumulated in 1937 wTere substantially reduced.
In the spring of 1938 the Administration announced a program of
action for the purpose of encouraging economic recovery. As a part of
this program the Treasury discontinued the inactive gold account, and
the Board reduced by one-eighth the percentage of reserve requirements
for member banks. As a result of these actions, together with a large
inflow of gold from abroad, member banks near the end of the year had
a larger amount of funds available for investment than at any previous
time.
23
FEDERAL RESERVE SYSTEM
Loans by banks to trade and industry declined during the year, while
their investments increased by a corresponding amount, so that the total
volume of outstanding bank credit showed little change. The gold inflow,
however, had resulted in a sharp increase in bank deposits. At the end
of the year deposits belonging to the public and available for use in
business or for investment were at new high levels.
The banks, therefore, are in a position to contribute to recovery by
easily meeting such legitimate demands for funds as may develop. The
rate of turnover of existing deposits, however, continues to be unusually
low.
Development of Business Recovery.—Output at factories and mines,
as measured by the Board's seasonally adjusted index shown on the
chart, was 79 in the first quarter and 77 in the second quarter of 1938, as
compared with a level of 116 in the first eight months of 1937. Activity
on the railroads was also reduced and in other public utilities, particularly
the electric power industry, output was below the levels of early 1937.
Construction activity was in reduced volume though residential building,
INDUSTRIAL PRODUCTION
ADJUSTED FOR SEASONAL VARIATION, 1923-25 AVERAGE =100
140
140
120
100
1920
1922
1924
1926
1928
1930
1932
1934
1936
24
ANNUAL REPORT OF BOARD OF GOVERNORS
in contrast to other lines, began to increase early in the year. Owing
primarily to the continued depressed condition of industry, security prices
and prices of industrial materials, which had shown a sharp decrease
in the latter half of 1937, declined somewhat further in the early part of
1938. Prices of farm products and foods also showed a further decline.
Income receipts of individuals in the first half of 1938 were at a lower
level than in the first three quarters of 1937 but the reduction was much
less than in industrial activity and industrial payrolls. Decreases in payrolls in trade and in the service industries and declines in farm income
were considerably smaller, and there were sharp increases in governmental
relief and benefit payments. Reflecting the smaller decline in income,
consumer purchases, although reduced, continued at a level substantially
higher than production of consumers' goods, and consequently there was
a continuous reduction in inventories of finished consumers' goods, which
had been large. There were reductions also in inventories of many semifinished materials previously accumulated. Supplies of raw materials,
however, remained large.
Early in the spring, although incomes were still declining, residential
building rose more than seasonally, stimulated by reductions in costs,
particularly financing costs. At the end of the year residential building
contracts, on a seasonally adjusted basis, were at the highest level since
1929. Contracts for non-residential construction also increased to the
end-of-1929 level, reflecting principally an increase in public projects.
By the middle of 1938 a few other major industries had begun to
show increases in activity, and evidence was accumulating that inventories had been materially reduced. In June prices of stocks and lowergrade bonds began a rapid advance and prices of speculative industrial
materials also rose considerably. Subsequently there was a general and
rapid increase in industrial activity. In December the Board's index
of industrial production reached 104, the volume of freight-car loadings was substantially higher than in the summer, and electric power
production was at about the highest level previously reached.
Increases in output were at first most pronounced in industries producing nondurable goods, particularly textiles. Steel production, which
had been at less than a third of capacity in the first half of the year,
also increased sharply during July and August, and there were moderate
increases in many other lines. After August output of nondurable manufactures showed little further increase. Steel production advanced
further, reaching a rate of somewhat over 60 percent of capacity in
November, and there were marked increases in output of automobiles
and related products, which earlier had been in small volume. In other
lines recovery was not so rapid as in the textile, automobile, and steel
industries. Activity in the machinery industry had increased only
slightly by the end of the year. In the railroad equipment industry operations remained at an unusually low level. Mineral production increased
FEDERAL RESERVE SYSTEM
25
only gradually, owing partly to the fact that stocks of both metals and
fuels continued large in relation to current consumption.
Accompanying the general rise in activity, there were marked increases
in employment, payrolls, and national income. Unemployment, however,
continued in large volume and relief expenditures remained at the high
levels reached in midsummer. Payrolls increased more than employment,
owing to an increase in the average number of hours worked. Reflecting
largely the increase in payrolls, income receipts began to increase in the
summer and by the end of the year had advanced to within five percent
of the level in the middle of 1937. The volume of retail trade also rose
and toward the end of the year was only moderately below the level
prevailing during most of 1937.
Prices of a number of industrial materials advanced after the middle
of June, while finished industrial products continued to decline in price
and farm products and foods showed little change. The general level of
wholesale prices declined slightly and at the end of the year was at 77
percent of the 1926 average as compared with about 80 during most of
1935 and 1936, prices of industrial commodities being slightly higher than
in that period and farm products and foods considerably lower.
In agriculture, harvests of principal crops in 1938 were abundant and,
with large supplies on hand and reduced demand expected from both
domestic and foreign sources, prices of crops were at the lowest levels
in recent years. Output of livestock and products was larger than
in 1937 and, with lower consumer incomes, prices were considerably
below the high level reached in the previous year. Farm income from
marketings was about 13 percent smaller than in 1937, but Government
payments were larger and total cash farm income in the calendar year
1938 was estimated at $7,600,000,000. This was 11 percent less than in
1937, when farm income was the highest since 1929.
At the close of 1938 the volume of industrial production and of the
movement of goods from producers appeared to be close to the level of
current consumption in most lines. Expenditures by industry on plant
and equipment continued at a low level, however, and further sustained
business recovery seemed to depend largely on a substantial increase
in these outlays with accompanying further growth in consumption.
GOLD AND CAPITAL MOVEMENTS
The year 1938 was marked by a reversal of the gold outflow that developed in the final quarter of 1937. At that time, with the onset of
business depression and declining prices in this country, the possibility
that the United States might once more resort to devaluation of the
dollar began to be discussed abroad and there were large-scale withdrawals of foreign short-term balances. In three months foreigners withdrew $500,000,000 net from their accounts in American banks, an amount
roughly equivalent to the volume of funds accumulated during the pre-
26
ANNUAL REPORT OF BOARD OF GOVERNORS
ceding spring when a reduction in the price of gold was widely anticipated.
The altered economic situation in the United States led also to the development of an excess of merchandise exports amounting to about
$100,000,000 a month in the final quarter of 1937. Increased agricultural output in the United States resulted in larger exports and smaller
imports of certain agricultural commodities, and the business recession
was reflected in sharply reduced imports of industrial raw materials.
Although payment for the excess of merchandise exports absorbed more
than half the dollar balances that were being offered in the exchange
market, the total volume of balances withdrawn was such that the
United States lost a substantial amount of gold.
The outward gold movement did not continue long in 1938. Repatriation of foreign funds diminished while the excess of merchandise exports
was maintained close to the level of $100,000,000 a month reached in
1937. For about two months these opposing factors were about in balance in the exchange market, and little gold moved. With the German
entry into Austria in March, however, the outflow of funds from the
United States was sharply curtailed and ceased to offset the continuing
surplus of merchandise exports, with the result that there was an inflow
of gold at the rate of about $40,000,000 a month from March through
July.
In the second half of the year there was pronounced recovery in American business conditions. The British position, meanwhile, had been
somewhat weakened by industrial recession at home and by less favorable conditions in the foreign trade of the United Kingdom and of those
British Empire and other countries that customarily hold the bulk of their
international reserves in London. The shift in the position of these areas
was in part a consequence of the extensive decline that had occurred in
American purchases of industrial raw materials and grains.
Toward the end of July the withdrawal of European short-term money
from the United States largely ceased, and early in August foreigners
began to send their funds back to this country. The inflow of capital
was small at first, but as the Czech crisis developed in August the movement of funds was intensified, and during the critical September weeks
it reached unprecedented proportions. The inflow continued on a substantial scale through October and thereafter intermittently to the end
of the year. During these developments the international flow of funds
served to reinforce the influence of the surplus of merchandise exports,
with the result that the United States gained about $1,450,000,000 of
foreign gold in a period of five months.
Most of the capital inflow that began in August represented a transfer
of funds from the United Kingdom. Part of these funds were owned by
British nationals but to a large extent they represented foreign shortterm money that had previously been accumulated in London. It is
probable that British gold losses were by far the largest experienced
FEDERAL RESERVE SYSTEM
27
since suspension of the gold standard in 1931. Between the end of March
and the end of September, the only dates in 1938 for which figures are
available, the gold holdings of the British Stabilization Fund declined
$730,000,000, and in the last quarter there were undoubtedly substantial
further declines. Sterling exchange rates declined from over $5.00 at the
beginning of 1938 to below $4.70 in the last few weeks of the year. Early
in January 1939 the Bank of England transferred to the Fund gold
valued at about $1,650,000,000, thus raising the resources available for
the support of sterling.
Other countries appear to have lost little gold in the latter part of
1938. For a while in August there was a substantial movement of capital
from France to England. This movement was associated with internal
French difficulties and was largely brought to a halt with reiteration by
the French Government on August 21 that the franc would not be permitted to fall below 179 francs to the pound, the limit of depreciation
established by the Government in May, and that there would be no
exchange control. There was little subsequent movement of capital out
of France, and beginning in November, when the Government adopted
additional measures to deal with the country's economic and financial
difficulties, there was a substantial repatriation of capital.
BANKING AND CREDIT CONDITIONS IN 1938
In 1938 the volume of bank deposits, following a slight decline in
1937, resumed the growth which has been the general trend since 1933.
At the end of the year the combined total of deposits at all banks, excluding interbank deposits, and of currency in circulation outside banks was
about $58,500,000,000/ a larger amount than at any previous time. Bank
deposits and bank reserves were each increased during the year by about
$1,700,000,000, principally as the result of gold imports. Partly because
of the increase in bank reserves resulting from gold acquisitions and partly
because of the reduction by the Board of Governors of $750,000,000 in
reserve requirements, excess reserves of member banks increased in 1938
by about $2,000,000,000.
Early in December excess reserves of member banks at $3,500,000,000
were larger than at any previous time. After the middle of December
they were reduced substantially by a temporary increase in Treasury
deposits at the Reserve banks and by withdrawals of currency by the
public to meet requirements for the holiday season. At the close of the
year excess reserves were about $3,200,000,000. In January 1939 they
increased again to a new high level.
1
The composition of this figure differs from that of the figure of $59,044,000,000 for gross deposits
of all banks in the United States on June 30, 1938, given in the table on page 7 of this report.
The figure here given is partly an estimate and represents the current means of payment in the
hands of the public plus their savings deposited in banks and in the Postal Savings system and the
deposits of the United States Government; it includes, therefore, in addition to bank deposits,
Postal Savings deposits and money in circulation outside banks but, to avoid double counting,
excludes interbank deposits and checks in process of collection shown on the books of banks. The
figures given on page 7 are designed to show the relative importance of the different groups of
banks in the banking structure and include all types of deposits in banks without adjustment.
28
ANNUAL REPORT OF BOARD OF GOVERNORS
Little Change in Bank Loans and Investments.—Additions to deposits
and reserves of member banks in 1938 resulted largely from gold acquisitions and were not accompanied by increases in bank loans and investments. This was largely due to a limited demand for loans and a small
supply of new investments of the types most commonly purchased by
banks. With the decline in business activity and reduction in inventories
during the first half of 1938 loans to commerce and industry were reduced, and the demand for new loans of this type was smaller than in
1936 and 1937, when bank loans had increased substantially. The improvement in business in the latter part of 1938 was not accompanied
by increases in inventories and did not occasion additional short-term
borrowing by commerce and industry. The decline in the stock market,
which began in 1937 and continued through the early months of 1938,
resulted in a reduction in brokers7 advances to their customers and consequently in bank loans to brokers. The subsequent advance in stock
prices was accompanied by some increase in the use of credit, but brokers'
loans continued at a lower level than in 1937. Banks outside the larger
cities showed a steady, although small, increase in their real estate loans
in the course of the year.
In the first half of 1938 when bank holdings of investments declined,
new security issues both public and private were in small volume. In
that period, the outstanding amount of publicly-offered direct obligations of the United States Government was reduced, as the Treasury
used previously accumulated balances to meet the excess of current
expenditures over receipts and also to retire open-market debt. The
reduction was in Treasury notes and bills, which are largely held by
banks, while offerings of bonds, which are purchased to a greater extent
by investors other than banks, increased. Bank holdings of direct Government obligations, therefore, declined somewhat in the first half of
1938. Later in the year, when there were increased offerings of Treasury securities, banks again increased their holdings of these obligations.
Near the middle of the year they also increased their holdings of obligations guaranteed by the United States when offerings of short-term issues
were made by Government agencies. Bank holdings of obligations of
States and local governments increased during the year. Holdings of
corporate securities showed little change; member banks in general
reduced holdings of railroad and other public utility securities in the first
half of the year, while in the third quarter, the latest period for which
detailed bank figures are available, there was some increase in corporate
investments of banks, accompanying an increase in the volume of new
corporate issues.
Increase in Idle Funds.—With the small change in total loans and
investments of banks and the large growth in reserves, the supply of
idle funds of banks increased considerably in 1938. For the banking
system as a whole these idle funds are represented by excess reserves
29
FEDERAL RESERVE SYSTEM
with the Federal Reserve banks, while for individual banks they may
be represented by the total of excess reserves and excess balances with
other banks. Deposits of other domestic banks at member banks increased during the year to a new high level of over $6,500,000,000.
Most of the growth in deposits, other than interbank, during 1938
was at New York City banks, with some growth at banks in other
cities, and but little increase at country banks. In addition outside banks
placed a part of their funds on deposit with New York City banks, with
the result that the largest part of the increase in excess reserves during
the year was in New York City.
The growth of deposits in 1938 was not accompanied by an increase
in their use by depositors. The estimated rate of turnover of deposits
for all banks, other than mutual savings banks, as measured by the ratio
of checks drawn to outstanding deposits, was at the exceptionally low
level of about 13 times per annum in 1938. This rate had been about
15 in other recent years and averaged 20 in the period 1922-1926 and 27
in 1929.
Reflecting the abundant supply of funds, there was a further small
decline during 1938 in both short- and long-term money rates on the
open market and in rates charged bank customers. At the end of the
year Treasury notes of 3-5 year maturity were yielding less than one
percent, long-term United States Government bonds about 2V> percent,
and the highest grade corporate bonds about 3 percent.
EARNINGS AND EXPENSES OF THE FEDERAL RESERVE BANKS
Current earnings of the Federal Reserve banks in 1938 amounted to
$36,300,000, or $5,000,000 less than in 1937. This decrease in earnings
reflected principally a decrease of $4,600,000 in earnings on United
EARNINGS
AND E X P E N S E S
OF FEDERAL RESERVE B A N K S
I In thousands
DURING
1938 AND 1937
of dollars]
1938
1937
Current earnings
36,261
41,233
Current expenses:
Net operating expenses
Assessments for Board's expenses
Cost of Federal Reserve currency
25,557
1,725
1,629
25,295
1,748
1,758
28,911
28,801
7,350
12,432
9,827
7,595
3,359
4,990
2,232
•il,631
9,582
10,801
120
8,019
-419
1,862
177
7,941
67
2,616
Total
Current net earnings
Additions to current net earnings
Deductions from current net earnings
Net additions
Net earnings
Payment to United States Treasury (sec. 13b)
Dividends paid
Transferred to surplus (sec. 13b)
Transferred to surplus (sec. 7)
1
N e t deductions.
30
ANNUAL REPORT OF BOARD OF GOVERNORS
States Government securities, which amounted to $34,400,000 in 1938.
Net earnings of the Federal Reserve banks, available for dividends and
transfers to surplus, were $9,600,000 in 1938, a decrease of $1,200,000
from 1937. Combined earnings, expenses, net earnings, and distribution
of net earnings of the Federal Reserve banks for 1938 as compared with
1937 are shown in the table on page 29.
Net operating expenses in 1938, amounting to $25,557,000, were
$262,000 more than in 1937. Total current expenses, including assessments for expenses of the Board of Governors and the cost of Federal
Reserve currency, were $110,000 more than in the previous year. The
principal items of expenses are shown in the following table:
CURRENT EXPENSES OF FEDERAL RESERVE BANKS DURING 1938 AND
1937
[In thousands of dollars]
1938
Operating expenses:
Salaries and Retirement System contributions.
Postage and expressage
Taxes on bank premises
Depreciation on bank buildings
Printing, stationery, and supplies
Telephone and telegraph
Allother
Total
Less reimbursements for certain fiscal agency and other expenses...
Net operating expenses
Assessment for expenses of Board of Governors.
Cost of Federal Reserve currency
Total current expenses.,
1937
19,837
3,226
1,433
1,172
752
472
2,753
19,412
3,288
1,392
1,298
770
536
2,547
29,645
4,088
29,243
3,948
25,557
25,295
1,725
1,629
1,748
1,758
28,911
28,801
As shown in the table on the preceding page, current net earnings
amounted to $7,350,000 in 1938, or $5,082,000 less than in 1937. This
decrease resulted primarily from a decrease of $4,972,000 in total current earnings. Additions to current net earnings in 1938 were
$9,827,000, including $8,276,000 profits on sales of United States Government securities. Deductions from current net earnings in 1938 were
$7,595,000. This included $5,046,000 for contributions by the Federal
Reserve banks to the Retirement System for the purpose of completing
payments on account of service of employees rendered prior to the
establishment of the Retirement System, which heretofore had been
scheduled to be completed by the end of 1939, and $848,000 for losses
and reserves for estimated losses on industrial advances.
Net earnings amounted to $9,582,000 in 1938, as compared with
$10,801,000 in 1937. All Federal Reserve banks paid dividends to member banks at the rate of 6 percent per annum on paid-in capital
stock as provided in the Federal Reserve Act. Dividend payments
totaled $8,019,000 in 1938, compared with $7,941,000 in 1937. Payments
to the United States Treasury under provisions of section 13b of the
31
FEDERAL RESERVE SYSTEM
Federal Reserve Act relating to industrial advances amounted to
$120,000 in 1938 and $177,000 in 1937. The remainder of the net earnings of the Federal Reserve banks, transferred to surplus accounts,
amounted to $1,443,000 in 1938 and $2,683,000 in 1937.
Gross and net earnings during the year 1938 and the distribution
of net earnings of each Federal Reserve bank are shown in the following
table:
FINANCIAL RESULTS OF OPERATIONS OF THE FEDERAL RESERVE BANKS DURING
Federal
Reserve
bank
Gross
earnings
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St Louis
Payment
to U. S.
Treasury
(sec. 13b)
Dividends
paid
Transferred
to surplus
(sec. 13b)
-$286,745
4,735
$2,690,183
10,706,348
3,151,090
3,490,621
$749,527
3,290,671
1,052,956
1,049,626
83,968
227
$564,369
3,056,972
734,562
799,145
1,915,952
1,502,189
3,954,026
1,564,278
200,875
253,701
1,090,958
254,607
20,714
1,796
297,732
267,368
791,007
234,488
1,100,472
1,840,455
1,330,456
3,015,358
373,298
260,690
232,260
772,785
1,005
10,270
36,261,428
9,581,954
119,524
...
Minneapolis
Kansas City
Dallas
San Francisco
Total
Net
earnings
$1,544
-115,893-17,409
206
174,231
249,901
236,294
613,068
-4,034
8,019,137
-419,140
1938
Transferred
to surplus
(sec. 7)
$183,614
520,444
229,691
250,254
19,036
3,742
279,031
18,323
198,0Q2
519
159,717
1,862,433
Total earnings on bills and securities were $4,900,000 less in 1938 than
in 1937. The reduction in earnings was a net result of an increase of
$48,000,000 in daily average holdings of bills and securities and a decrease from 1.59 percent to 1.37 percent in the average rate of earnings.
Average daily holdings of bills and securities, together with average
rates and amounts of earnings thereon during the last four years, are
shown in the following table:
EARNINGS ON BILLS AND SECURITIES
[Amounts in thousands of dollars]
Total
Daily average holdings:
1935
1936
1937
1938
Earnings:
1935
1936
1937
1938
Average rate of earnings (percent):
1935
1936
1937
1938
Bills
discounted
United States
Bills
bought in
Government
open market securities l
Industrial
advances
2,469,542
2,469,688
2,542,545
2,590,597
7,306
6,135
13,749
8,739
4,922
3,725
3,390
543
2,430,864
2,430,657
2,503,865
2,564,877
26,450
29,171
21,541
16,438
41,473
36,909
40,352
35,404
156
108
212
124
36
30
24
3
39,797
35,184
39,025
34,446
1,484
1,587
1,091
831
1.68
1.49
1.59
1.37
2.14
1.76
1.54
1.42
.73
.81
.71
.48
1.64
1.45
1.56
1.34
5.61
5.44
5.06
5.05
1
Figures for 1935 and 1936 include $43,000 and $122,000, respectively, of securities guaranteed as to both
principal and interest by the United States.
32
ANNUAL REPORT OF BOARD OF GOVERNORS
BRANCHES AND AGENCIES OF THE FEDERAL RESERVE BANKS
In accordance with action taken by the Boards of Directors of the
Federal Reserve Banks of Atlanta and San Francisco, with the approval
of the Board of Governors, the agency of the Federal Reserve Bank of
Atlanta located at Havana, Cuba, and the branch of the Federal Reserve"
Bank of San Francisco located in Spokane, Washington, were discontinued effective October 1, 1938, As of the same date, ten counties in
northern Idaho and four counties in southwestern Washington were
transferred from the Seattle Branch to the Portland Branch of the Federal Reserve Bank of San Francisco. Effective November 1, 1938,
Calhoun and Refugio Counties, Texas, were transferred from the San
Antonio Branch to the Houston Branch of the Federal Reserve Bank
of Dallas.
INDUSTRIAL ADVANCES
By the Act of June 19, 1934, Congress authorized Federal Reserve
banks under certain circumstances to extend credit for the purpose of
furnishing working capital to established businesses.
For the period from June 19, 1934, to December 28, 1938, the Federal
Reserve banks received 9,336 applications amounting to $398,898,000.
Of these applications 2,653 were approved, amounting to $175,011,000.
A somewhat greater number of applications was received in 1938 than in
1937 and there was also an increase in applications approved. Owing
to repayments of previous advances, however, the amount of loans outstanding declined slightly during the year. Figures for applications and
amounts outstanding by years are as follows:
[Amounts in thousands of dollar^
Applicatio is received
Applications approved
Year
Number
Amount
Number
Amount
1934
1935
1936
1937 .
1938
5,108
2,507
764
298
659
190,798
115,910
35,991
20,593
35,606
1,020
973
287
126
247
52,257
72,236
15,336
11,158
24,024
Total
9,336
398,898
2,653
175,011
Advances and
commitments
outstanding at
end of year
Amount
24,348
60,142
45 293
30,977
29,916
On Wednesday, December 28, 1938, the Federal Reserve banks held
$15,688,000 of industrial loans and had outstanding commitments to
purchase such loans made by banks amounting to $14,162,000. The
largest amount of advances and commitments outstanding under this
authority at any one time was about $61,000,000 in December 1935.
The credits that have been extended by the Federal Reserve banks under
this authority, either directly to business or in cooperation with banks
and other financing institutions, vary in size from $250 up to amounts
33
FEDERAL RESERVE SYSTEM
of several millions of dollars. Loans have been approved for a wide
variety of enterprises.
CREDITS TO FOREIGN CENTRAL BANKS
The share of the Federal Reserve banks in the credit to the National
Bank of Hungary granted in 1931 amounted to $2,055,000 at the end of
1938 as compared with $2,282,000 a year earlier. The terms of the
renewal agreement of 1937, mentioned in the Board's annual report for
that year (p. 35), were carried out in full by the National Bank of
Hungary.
A loan of $80,000 secured by gold was granted to a foreign central
bank in January 1938 under an authorization by the Board of Governors
in the same month. The loan was repaid in full in February, in advance
of the date of maturity. There were no further loans of this type during
the year and none outstanding at the close of the year.
BUILDING OPERATIONS OF THE FEDERAL RESERVE BANKS
The new banking quarters of the Helena Branch of the Federal Reserve
Bank of Minneapolis were completed and occupied in June 1938. In
August 1938 the Federal Reserve Bank of Dallas purchased a lot and
building adjoining the Houston Branch building. All Federal Reserve
banks and their branches, except the Cincinnati, Charlotte, Portland,
and Seattle branches, are housed in buildings owned by the banks.
FEDERAL RESERVE INTERDTSTRICT COLLECTION SYSTEM
The number of banks on the Federal Reserve par list at the end of
1938 was 11,973, comprising all of the 6,338 member banks and 5,635
INTERDTSTRICT
COLLECTION
Member banks
Dec. 31,
1938
Dec, 31,
1937
6,338
Boston
New York..
Philadelphia
Cleveland
356
772
655
624
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
r Revised.
Nonmember banks, other than mutual
savings banks 1
On par list
Federal Reserve district
United States.
SYSTEM
Not on par list
Dec. 31,
1938
Dec. 31,
1937
Dec. 31,
3938
i,341
5,635
5,800
2,760
r 2,776
357
776
655
622
169
288
' 258
617
169
r 290
263
624
406
320
787
391
405
324
769
392
314
90
1,515
727
r 321
94
1,568
762
335
690
218
437
343
683
220
436
461
734
544
288
469
733
547
292
156
964
283
254
171
985
288
265
710
178
161
29
722
177
161
32
Dec. 31,
1937
34
ANNUAL REPORT OF BOARD OF GOVERNORS
nonmember banks. The number of nonmember banks (other than mutual
savings banks) not on the par list was 2,760. Banks on the par list pay,
without deduction of exchange charges, such checks drawn upon them
as are presented or forwarded for payment by the Federal Reserve banks.
During the year the number of nonmember banks on the par list decreased by 165, principally because of a reduction in the number of such
banks in operation, and the number of banks not on the par list decreased
16. Of the banks which were not on the par list at the beginning of the
year, 71 went out of existence during 1938 and 10 were added to the par
list. During the year, 28 nonmember banks withdrew from the par list,
25 newly organized banks opened as non-par banks, and 12 member
banks became nonmember non-par banks. This gross addition of 65 to
the number of non-par banks during 1938 took place principally in three
Federal Reserve districts, namely, Atlanta 23, St. Louis 14, and Minneapolis 11. The net increase in the number of non-par banks in the
Atlanta district was 7 and in the St. Louis district 1, while in the Minneapolis district there was a net reduction of 12 in the number of such
banks.
As will be seen from the table, all of the banks in the Boston, New
York and Philadelphia districts and all but two banks in the Cleveland
district, were on the Federal Reserve par list at the end of 1938. At the
end of the year the distribution of the number of non-par banks by
States was as follows: Minnesota 410, Georgia 254, Mississippi 175,
Tennessee 169, Nebraska 163, North Carolina 163, Wisconsin 161, Alabama 130, Arkansas 129, North Dakota 125, South Carolina 121, Iowa
108, Texas 105, Missouri 105, Louisiana 104, South Dakota 92, Florida
84, Virginia 45, and twelve other States 117.
AGREEMENTS OF NONMEMBER BANKS UNDER SECURITIES EXCHANGE ACT OF 1934
Under Section 8 (a) of the Securities Exchange Act of 1934 and the
Board's Regulation T, brokers and dealers subject to the Act may not
borrow in the ordinary course of business from a nonmember bank on
registered securities (other than exempted securities) unless such nonmember bank has signed an agreement with and in the form prescribed
by the Board of Governors of the Federal Reserve System. At the end
of the year there were 152 nonmember banks with such agreements in
force.
AMENDMENTS TO THE FEDERAL RESERVE ACT
Renewal of Loans to Executive Officers of Member Banks.—By Act of
Congress approved April 25, 1938, section 22 (g) of the Federal Reserve
Act was amended so as to permit loans made to an executive officer of a
member bank prior to June 16, 1933, to be renewed or extended, subject
to the other provisions of the law, for periods expiring not later than
June 16, 1939 (instead of June 16, 1938, as the law had previously provided).
FEDERAL RESERVE SYSTEM
35
Waiver of Double Liability of Stockholders of Closed Insured Banks.
—By an Act of Congress approved May 25, 1938, section 12B of the
Federal Reserve Act was amended to provide for the waiver by the Federal Deposit Insurance Corporation, in connection with the liquidation
of closed insured banks, of any claim it might otherwise have by reason
of the so-called double liability of stockholders of such banks in States
in which double liability has not already been abolished by statute.
Loans by Federal Deposit Insurance Corporation to Insured Banks.—
By an Act of Congress approved June 16, 1938, section 12B of the Federal Reserve Act was amended to make permanent the authority of the
Federal Deposit Insurance Corporation to make loans to or purchase
assets from insured banks in order to facilitate mergers or consolidations
of insured banks and reduce or avert threatened losses to the Corporation.
CHANGES IN REGULATIONS OF THE BOARD OF GOVERNORS
The regulations of the Board of Governors were amended and revised during the year 1938 in the following respects:
Reduction in Reserve Requirements of Member Banks.—On April 15,
1938, the Board of Governors issued a new supplement to its Regulation
D reducing reserve requirements on all classes of deposits for all member
banks, effective at the opening of business on April 16, 1938. Under the
new supplement, every member bank is required to maintain on deposit
with the Federal Reserve bank of its district a balance equal to 5 percent
of its time deposits plus: 12 percent of its net demand deposits if not in
a reserve or central reserve city, 17% percent of its net demand deposits
if in a reserve city, and 22% percent of its net demand deposits if in a
central reserve city, except that banks in outlying districts of reserve or
central reserve cities may be permitted by the Board of Governors to
maintain lesser reserves against their demand deposits.
Interlocking Bank Directorates under the Clayton Act.—In September, 1938, the Board of Governors adopted an amendment to its Regulation L, effective February 1, 1939, eliminating the words "Morris Plan
bank'7 from subsection (a) of section 3 of the regulation. The effect
of this action was to revoke the permission which the Board had previously granted in the regulation to any private banker or any director,
officer, or employee of a member bank to serve as a director, officer or
employee of not more than one Morris Plan bank or similar institution,
in cases where such service would otherwise have been prohibited. However, by action effective November 7, 1938, the regulation was amended
to permit a relationship of this kind which was lawfully existing on
.January 31, 1939, to continue until August 1, 1939.
At the same time, the Board also adopted an amendment to its regulation affecting a number of other interlocking directorate relationships
which would have become unlawful on February 1, 1939. This amendment permits any such relationship which was lawfully existing on
36
ANNUAL REPORT OF BOARD OF GOVERNORS
August 23, 1935, and which would otherwise have become unlawful on
February 1,1939, to continue as to not more than two banks until August
1, 1939.
The reasons for the Board's actions are set forth in the statement
appearing in the record of policy actions on page 75.
Extension of Credit by Brokers, Dealers, and Members of National
Securities Exchanges.—Effective March 21, 1938, the Board of Governors amended its revised Regulation T in certain technical respects in
order to facilitate transactions involving withdrawals from special
omnibus accounts, shipments of securities in connection with special
cash accounts, or financing of odd-lot dealers in special miscellaneous
accounts.
REGULATION OF THE FEDERAL OPEN MARKET COMMITTEE
Effective March 1,1938, the Federal Open Market Committee amended
its regulation relating to open-market operations of Federal Reserve
banks in certain details regarding the purchase and sale of Government
securities and the making of reports by the Federal Reserve banks of
other open-market operations.
REVISED FORM OF CONDITION REPORT
During the year the Office of the Comptroller of the Currency, the
Federal Deposit Insurance Corporation, and the Board of Governors of
the Federal Reserve System worked out a revised form for the use of
banks in submitting condition reports to Federal banking authorities.
Detailed instructions were also prepared for the purpose of assisting
banks in compiling their. reports of condition. This standardization of
the condition report and of the accompanying instructions was the result
of work and negotiations extending over several years, after consultation
with several groups outside the Federal agencies. The revised form of
report was adopted by each of the Federal agencies in an essentially
standardized form for use beginning with the December 31, 1938, call
for condition reports. In addition, the executive committee of the
National Association of Supervisors of State Banks approved the report
form and recommended that, insofar as practicable, it be adopted by
State banking departments.
BANK EXAMINATIONS
Federal Reserve Banks.—Each of the 12 Federal Reserve banks was
examined during the year by the Board's Division of Examinations.
Foreign Banking Corporations.—The head office of the one banking
corporation now in active operation organized under the provisions of
section 25 (a) of the Federal Reserve Act to engage in foreign or international banking was examined during the year by the Board's Division
of Examinations.
FEDERAL RESERVE SYSTEM
37
State Member Banks.—State member banks are subject, under the
provisions of the Federal Reserve Act, to examinations made by direction of the Board of Governors of the Federal Reserve System or of the
Federal Reserve banks by examiners selected or approved by the Board
of Governors. The policy approved by the Board of Governors for
examinations pursuant to such provisions is that at least one regular
examination of each State member bank, including its trust department,
be made during each calendar year by examiners for the Federal Reserve
banks. The general practice is to make one examination a year of each
State member bank. Almost all of such examinations made during the
past year were in cooperation with the State banking authorities pursuant to the policy of making joint examinations wherever practicable
in order to avoid duplication of examinations and to minimize inconvenience to the banks examined.
Revised Examination Procedure.—An important development during
the year in the field of bank examination and supervision was the revision of procedure in bank examinations agreed to by the Secretary of the
Treasury, the Board of Governors of the Federal Reserve System, the
Directors of the Federal Deposit Insurance Corporation, and the Comptroller of the Currency. The revised procedure as announced by the
Secretary of the Treasury is published in the appendix to this report.
The agreement was reached in the summer and the revised procedure was
made effective in September after the examination report forms had been
revised to give effect to the changed procedure. Representatives of the
National Association of Supervisors of State Banks were consulted in
regard to the program and the Executive Committee of the Association
agreed in principle with the program as adopted. The revised procedure
has been made effective in many States and is being made effective in
whole or in part in others.
The principal changes in the examination procedure were the abandonment of the "slow" classification of assets and recognition of the
principle that bank investments should be considered in the light of
inherent soundness rather than on the basis of day-to-day market
fluctuations.
The "slow" classification had long been a source of irritation, complaint, and misunderstanding. By its very name it emphasized liquidity
but the term was a misnomer inasmuch as the "slow" classification did
not include all loans of longer maturities. The exact meaning of the
term was not clear, nor could a substitute term be found to express
clearly what was intended by the classification. Accordingly the old
classifications of "slow," "doubtful," and "loss" as used in reports of
examinations were discontinued and numerical classifications were
adopted with the reports of examination containing definitions of the
types of assets to be included in each classification. Under the new
designations the principle is clearly recognized that in making loans
38
ANNUAL REPORT OF BOARD OF GOVERNORS
banks should be encouraged to place emphasis upon soundness and intrinsic value rather than upon liquidity or quick maturity, and the examiners are expected to follow this principle in their examinations.
With respect to the appraisal of investment securities, the revised
examination procedure is based on the view that the soundness of the
banking system depends in the last analysis upon the soundness of the
country's business and industrial enterprises and should not be measured
by current market quotations which often fail to reflect true appraisals
of intrinsic worth. Under the revised procedure, as formerly, stocks and
defaulted securities are grouped separately and net depreciation in such
issues based on current market prices is classified as loss to be charged
off. Other securities, however, are divided into two groups which might
be considered, broadly, as (1) securities of investment character, and
(2) securities having distinctly or predominantly speculative characteristics. Appreciation or depreciation in securities in the first group is
disregarded, and banks are permitted to carry these securities at book
value with proper provision for amortization of premiums. Banks are
also not required to charge off on their books any depreciation in securities in the second group. Such securities, however, are appraised in
the report of examination on the basis of the average market price for
18 months preceding examination and in the #computation of adjusted
capital account of the bank, as shown in the report of examination, 50
percent of the net depreciation figured on such average basis is deducted.
By separating appraisal of bank investments from current market
quotations it was hoped that banks would be encouraged to purchase
securities for true worth. The revised procedure also recognized the need
for conservation of profits from the sale of securities, emphasized the
necessity for the maintenance of adequate reserves to provide for possible losses in securities and other assets, and reaffirmed the position
against the practice of speculation in securities.
In considering the question of bank examination and supervision
recognition was given to the great changes which have occurred during
the past 20 years in the composition and character of bank assets, the
substantial decrease in the holdings of short-term, self-liquidating commercial paper, and the great increase in the holdings of investment
securities, both in aggregate amount and as compared with total assets.
As a result of these developments, banks find it necessary to look, to a
considerable extent at least, for other forms of loans to replace the lost
volume of short-term commercial loans and to treat the security account
more as a permanent investment account than as a means for the
temporary investment of idle funds. Changes made by the Banking
Act of 1935 in the law regarding advances by Federal Reserve banks and
the revised regulation on this matter issued in 1937 by the Board of
Governors were designed to assist banks to meet these changed conditions. The new policies with respect to bank examination and super-
FEDERAL RESERVE SYSTEM
39
vision were framed with the same end in view. The revised examination procedure does not represent a relaxation of standards. It was
worked out as a measure which, with its emphasis upon fundamental
soundness of assets of every type, would further the maintenance of a
sound banking system and enable banks better to serve their depositors
and their communities.
TRUST POWERS OF NATIONAL BANKS
During the year 1938 ten national banks were granted authority by
the Board to exercise one or more trust powers under the provisions of.
section 11 (k) of the Federal Reserve Act. This figure includes two banks
which previously had been granted certain trust powers and during the
year were granted one or more additional powers; it also includes two
banks which previously had been authorized to exercise restricted trust
powers and during the year were granted full trust powers. In addition, the Board granted full trust powers contingent upon the conversion
of an existing State bank into a national banking association, which
conversion, however, had not been effected by the end of the year. The
Board also granted one national bank restricted authority to administer
a specific trust account. During the year ten operating national banks
surrendered their trust powers and ten other national banks which had
been granted trust powers were placed in voluntary liquidation.
On December 31, 1938, 1,883 national banks held permits to exercise
trust powers. A list of such banks, with indication of the power or
powers each bank is authorized to exercise, will be supplied to those
requesting it. In addition 13 national banks had authority at that time
to exercise restricted trust powers only.
The term "restricted trust powers" as used above refers to powers
granted a bank to acquire certain trust accounts but not to acquire
other fiduciary business. Such restricted powers have been granted to
enable a newly organized, consolidated, or converted institution to acquire the trust business held by a predecessor bank or banks, or to enable
a bank to administer certain specific trust accounts, when, in the light
of all the facts and circumstances in the particular case, such action was
deemed warranted.
HOLDING COMPANY AFFILIATES
During the year 1938 the Board acted upon the applications for voting
permits submitted by holding company affiliates of member banks in
accordance with the provisions of section 5144 of the Revised Statutes
and section 9 of the Federal Reserve Act, and authorized the issuance of
three permits for general purposes and one permit for limited purposes.
Under the authority of section 301 of the Banking Act of 1935, the
Board determined that four organizations were not engaged directly
or indirectly as a business in holding the stock of, or managing or con-
40
ANNUAL REPORT OF BOARD OF GOVERNORS
trolling, banks, banking associations, savings banks or trust companies,
and that, therefore, they were not holding company affiliates except for
the purposes of section 23A of. the Federal Reserve Act.
FOREIGN BANKING CORPORATIONS
During the year the number of corporations organized under State
law and operating under agreements entered into with the Board pursuant to the provisions of section 25 of the Federal Reserve Act relating
to the investment by member banks in stock of corporations engaged
principally in international or foreign banking was increased from three
to four. Bankers Company of New York, an affiliate of Bankers Trust
Company, New York, a member bank, entered into such an agreement
in connection with the Board's approval of the application of the member
bank to invest in stock of such corporation. The three other corporations
operating under agreements entered into with the Board in previous
years pursuant to the provisions of section 25 of the Federal Reserve
Act are: International Banking Corporation, which is affiliated with the
National City Bank of New York; First of Boston International Corporation, which is affiliated with the First National Bank of Boston; and
French American Banking Corporation, which is owned by the Guaranty
Trust Company of New York, the First National Bank of Boston, and
the Comptoir National D'Escompte of Paris.
The Chase Bank, which commenced business in 1930 and is affiliated
with the Chase National Bank of New York, is the only banking corporation in active operation organized under the provisions of section
25 (a) of the Federal Reserve Act to engage in international or foreign
banking.
Two of the five corporations referred to above have no foreign
branches. The other three corporations operate, either directly or through
subsidiary corporations, 11 foreign branches or offices distributed as
follows: in England, 3; France, 3; Spain, 2; China, 2; Hong Kong, 1.
FOREIGN BRANCHES OF MEMBER BANKS
During the year the following member banks established foreign
branches with the permission of the Board of Governors in accordance
with the provisions of section 25 of the Federal Reserve Act: The Central
Hanover Bank and Trust Company of New York established an additional branch in London; the Chase National Bank of New York established a branch in Balboa, Canal Zone; and the National City Bank
of New York established branches in Balboa and Cristobal, Canal Zone.
During the year the National City Bank of New York discontinued
operation of its branch in Genoa, Italy.
At the end of the year, seven member banks were operating a total
of 101 branches or offices located in 66 cities in 23 foreign countries or
dependencies or insular possessions of the United States. Of the 101
FEDERAL RESERVE SYSTEM'
41
branches and offices, four national banks were operating 90, and three
State bank members were operating 11. The foreign branches were
distributed geographically as follows:
10
3
4
4
2
7
3
20
Argentina
Belgium
Brazil
Canal Zone
Chile
China
Colombia
Cuba
Dominican Republic 6
13
England
2
France
1
Hong Kong
4
India
1
Italy
4
Japan
I
Mexico
4
Panama
1
Peru
Philippine Islands . . 1
Puerto Rico
7
1
Straits Settlements .
1
Uruguay
1
Venezuela
MEETINGS OF THE FEDERAL OPEN MARKET COMMITTEE
Meetings of the Federal Open Market Committee were held in Washington on the following dates in 1938: February 28-March 1, April 2122, April 29, August 2, September 21 and December 30. The executive
committee of the Federal Open Market Committee met from time to time
throughout the year as occasion required. A record of actions taken by
the Committee on questions of policy relating to open-market operations
is published in the appendix to this report.
MEETINGS OF THK FEDERAL ADVISORY COUNCIL
Four meetings of the Federal Advisory Council were held in Washington during 1938 on the following dates: February 14-15, May 16-17,
September 19-20, and November 28-29. Recommendations of the Federal
Advisory Council to the Board of Governors are published in the appendix to this report.
APPOINTMENT OF ERNEST G. DRAPER AS A MEMBER OF THE BOARD OF
GOVERNORS OF THE FEDERAL RESERVE SYSTEM
Effective March 30, 1938, Ernest G. Draper, of Connecticut (Second
Federal Reserve District), was appointed as a member of the Board of
Governors of the Federal Reserve System for the unexpired portion of
the term of fourteen years from February 1, 1936, which was made
vacant by the resignation of Joseph A. Broderick on September 30, 1937.
CHANGES IN BOARD STAFF
Charles S. Hamlin, member of the Federal Reserve Board and of the
Board of Governors from August 10, 1914, to February 1, 1936, and
Special Counsel to the Board of Governors since February 4, 1936, died
on April 24, 1938.
Effective March 29, 1938, George W. Blattner resigned as Assistant
Director of the Division of Research and Statistics.
BOARD EXPENDITURES
The total cost of conducting the work of the Board during the year
1938 was $1,707,503.67. This is exclusive of expenditures in the amount
42
ANNUAL REPORT OF BOARD OF GOVERNORS
of $106,972.50 made in connection with the new building erected by the
Board. For the general expenses of the Board two assessments were
levied against the Federal Reserve banks aggregating $1,724,922.40 or
about one-half of one percent of their average paid-in capital and surplus
for the year. Under an arrangement with the Federal Reserve Bank of
Cleveland the accounts of the Board were audited twice during the course
of the year 1938 by the Auditor of the Federal Reserve Bank of Cleveland, who certified them to be correct.
CHANGE IN FORM OF PUBLICATION OF ANNUAL REPORT
This Annual Report of the Board of Governors of the Federal Reserve
System will be issued in one edition and not in two editions as has been
customary with Annual Reports. In previous years a brief edition
of the Report has contained the text and the records of policy actions,
and the complete edition which appeared later included in addition a
large number of statistical tables and some other appendix material. This
year's Report contains only a few of the statistical tables and omits some
of the appendix material previously published. The additional material
previously included in the complete edition of the Annual Report will be
made available in the Federal Reserve Bulletin or in some other form.
TABLES
43
FEDERAL RESERVE SYSTEM
45
No. 1.—STATEMENT OF CONDITION OF THE FEDERAL RESERVE BANKS (IN DETAIL)
DECEMBER 31, 19381
ASSETS
Amounts in the column to the right are those shown in the Board's weekly statement, their components being
shown in the column to the left. (In thousands of dollars)
Gold certificates with Federal Reserve agents
Gold certificates in interdistrict settlement fund with Board of Governors
Gold certificates held by banks
4,888,000
5,389,276
1,510,444
Gold certificates on h a n d a n d due f r o m U . S. Treasury
Redemption fund—Federal Reserve notes
11,787,720
9,873
11,787,720
Total gold reserves
Other cash:
United States notes
Silver certificates
Standard silver dollars
National and Federal Reserve bank notes
Subsidiary silver, nickels and cents
87,418
256,215
2,823
1,885
19,872
Total other cash
,
368,213
Total reserves
12,165,806
Bills discounted:
Secured by U. S. Government obligations, direct or fully guaranteed: Discounted for
member banks
Other bills discounted: For member banks
2,099
1,872
Total bills discounted
3,971
Bills bought—payable in foreign currencies
Industrial advances
U. S. Government securities:
Bonds.,
Treasury notes
Treasury bills
T o t a l U . S. Government securities
549
15,644
..
,
2,564,015
Total bills and securities
Due from foreign banks
Federal Reserve notes of other Reserve banks
Uncollected items:
Transit items
Exchanges for clearing house
Other cash items
Total uncollected items
Bank premises
Other assets:
Miscellaneous assets acquired account industrial advances.
Industrial advances past due
Other bills and securities past due
Claims account closed banks
Total
Lessreserves
Net
Interest accrued
P r e m i u m on securities
Deferred charges
Suspense account and miscellaneous assets
Total other assets.
Total assets
b e f o r e closing books a t end of year.
840,893
1,156,947
566,175
2,584,179
172
32,570
661,304
17,911
31,634
710,849
44,350
1,410
1,606
2,058
2,502
7,576
4,486
3,090
7,243
29,875
368
4,175
44,751
15,582,677
46
ANNUAL REPORT OF BOARD OF GOVERNORS
No. 1.—STATEMENT OF CONDITION OF THE FEDERAL RESERVE BANKS (IN DETAIL)
DECEMBER 31, 19381—Continued
LIABILITIES
Amounts in the column to the right are those shown in the Board's weekly statement, their components being
shown in the column to the left. (In thousands of dollars)
Federal Reserve notes outstanding (issued to Federal Reserve banks)
Held by issuing Federal Reserve banks and branches
Forwarded for redemption
4,790,047
324,316
13,907
Federal Reserve notes in actual circulation (including notes held by Treasury and
by Federal Reserve banks other than issuing bank)
Deposits:
Member bank—reserve account
U. S. Treasurer—general account
Foreign bank
Other deposits:
Nonmember clearing account
Officers' checks
Federal Reserve exchange drafts
All other
4,451,824
8,723,226
923,195
199,211
101,794
51,469
288
87,864
Total other deposits
241,415
Total deposits
10,087,047
Deferred availability items
Other liabilities:
Accrued dividends unpaid
Unearned discount
Discount on securities
Reserves for estimated losses on bills and securities
Suspense account and miscellaneous liabilities
694,217
824
9
28
207
2,512
Total other liabilities
3,580
Total liabilities
15,236,668
CAPITAL ACCOUNTS
Capital paid in
Surplus (sec. 7)
Surplus (sec. 13b)
Other capital accounts:
Reserve for contingencies
32,221
Earnings:
Gross earnings
Current expenses
36,261
28,911
Current net earnings
Add—profit and loss
Deduct:
Dividends accrued since closing of books
7,350
4,460
,
8,019
Net earnings available for depreciation allowances, reserves and surplus
3,791
Total other capital accounts
Total liabilities and capital accounts
1
Before closing books at end of year.
134,575
147,739
27,683
36,012
15,582,677
47
FEDERAL RESERVE SYSTEM
No. 2.—MATURITY DISTRIBUTION OF BILLS AND UNITED STATES GOVERNMENT SECURITIES HELD BY FEDERAL RESERVE BANKS
[In thousands of dollars
Bills discounted
Maturity within
15 days
16 to 30 days
31 to 60 days
61 to 90 days
91 days to 6 months..
6 months to 1 year...
1 year to 2 years
2 years to 5 years
Over 5 years
Total
Bills bought in
open market
Dec. 28,
1938
Dec. 29,
1937
Dec. 28,
1938
Dec. 29,
1937
5,845
321
202
175
406
31
10,697
395
582
414
728
31
179
106
264
438
400
1,989
6,980
12,847
549
2,827
Industrial advances
U. S. Government
securities
Dec. 28,
1938
Dec. 29,
1937
Dec. 28,
1938
1,784
579
596
387
1,290
3,891
4,423
2,738
1,334
302
577
438
1,431
3,490
5,502
5,217
105,340
88,872
198,570
154,893
103,697
173,142
390,654
588,699
760,148
24,385
33,296
68,350
265,085
381,170
213,895
283,389
593,739
700,706
15,688
18,291
2,564,015
2,564,015
Dec. 29,
1937
No. 3.—STATEMENT OF CONDITION OF EACH FEDERAL RESERVE BANK AT END OF 1937 AND 1938
fin thousands of dollars]
New York
Boston
Total
Philadelphia
Cleveland
Richmond
1937
1938
1937
1938
1937
1S38
1937
1938
1937
1938
1937
1938
9 119,891
9,436
351,688
11 787,720
9,873
368,213
503 ,090
804
35 ,260
660 ,319
328
36 ,112
3,586,484
1,124
78,420
5,115,945
1,226
103,924
474,890
501
26,940
546,461
1,236
29,221
672,135
659
27,622
783,882
810
23,751
294,125
921
25,919
356 ,645
1
21 ,917
9 ,481,015
12 165,806
539 ,154
696 ,759
3,666,028
5,221,095
502,331
576,918
700,416
808,443
320,965
379 ,784
6,481
3,385
2,099
1,872
551
100
9
2,804
316
804
241
1,498
655
704
473
478
195
191
54
340
255
54
153
O
9,866
540
18,049
3,971
549
15,644
651
41
2 ,729
41
41
1 ,945
3,120
212
4,412
1,045
215
3,879
2,153
55
3,627
1,177
56
3,120
673
50
879
245
51
618
595
23
1,768
207
to
1 ,466
S3
O
751,539
1 ,154,997
657,479
840,893
1,156,947
566,175
54 ,751
84 144
47 ,899
63 ?87
87 ,073
42 ,611
216,814
333,211
189,679
267,426
367,938
180,058
63,561
97,685
55,607
73,057
100,515
49,189
73,157
112,432
64,002
84,554
116,335
56,931
39,394
60,540
34,462
39 ,461
54
26 ,569
2 ,564,015
2 ,564,015
186 ,794
192 ,971
739,704
815,422
216,853
222,761
249,591
257,820
134,396
120,321
? ,592,470
179
30,211
693,487
45,C27
37,241
? ,584,179
172
32,570
710,849
42,768
44,348
190 snf\
13
412
65 419
3 ,001
2 ,239
1P4 998
13
757
69 ,88?
2 ,945
2 ,893
747,448
68
5,292
195,811
9,973
10,808
820,561
65
5,337
207,064
9,038
13,388
222,688
18
1,662
54,588
4,826
4,305
227,114
17
2,081
54,506
4,699
4,637
251,193
17
1,984
64,245
6,215
4,057
258,734
16
1,966
74,509
6,017
5,018
136,782
8
2,886
53,628
2,700
2,231
199
12 ,879,630
15 ,580,692
800 ,453
968 ,247 ! 4,635,428
6,276,548
790,418
869,972 1,028,127 1,154,703
519,200
556 ,924
ASSETS
Gold certificates on hand a n d due from U. S. T r e a s u r y .
Redemption fund—Federal Reserve notes
O t h e r cash
Total reserves
Bills discounted:
Secured by U . S . G o v e r n m e n t obligations, direct
or fully guaranteed
Other bills discounted
T o t a l b i l h discounted
Bills b o u g h t in open market
Industrial advances
U . S . G o v e r n m e n t securities:
Bonds
T r e a s u r y notes
Treasury bills
.
Total U. S. G o v e r n m e n t securities
Total bills a n d securities
D u e from foreign banks
Federal Reserve notes of other Federal Reserve banks
Uncollected items
B a n k premises
. ..
O t h e r assets
Total assets
S3
W
s
018
7
2 ,946
47
621
2 ,508
3
S3
o
LIABILITIES
Federal Reserve notes in actual circulation *.
4,283,611
4,451,824
285,413 I 384,130 ; 964,902
Deposits:
Member bank—reserve account
U. S. Treasurer—general account
Foreign bank
Other deposits
7,026,809
142,390
171,750
235,743
8,724,050
923,225
199,211
241,512
402,354
7,103
12,665
4,044
7,576,692
674,000
4,109
12,538,412
10,087,998
694,217
2,998
15,237,037
426,166
64,886
132,744
147,739
27,683
33,052
134,575
149,152
27,264
32,664
9,386
9,900
2,874
1,448
Total deposits
Deferred availability items
Other liabilities including accrued dividends..
Total liabilities
776,845
392,294 i 3,071,762
81,324 !
39,295
14,360 ;
189,134
4,251
4S2.229 3,361,083
189,511
67,897
977
175
944,431 4,516,473
1,029,296 ; 318,035 i 320,562 , 433,328 ; 427,467
4,460,340
212,295
71,369
188,479
365,046
1,092
17,002
2,269
4,932,483 385,409
194,382
53,747
1,214
1,092
6,157,375 ! 758,283
209,905
208,287
477,880
116,296
18,349
7,228
220,566
10,888
7,460
3,599
231,576
48,507
8,576
2,033
501,702 ! 619,753
I 458.830
i 57,591 - 61,336 i 75,047
|
664s|
219 i
134
j 837,647
990.585 11,122,401
242,513
51,996
116
504,530
290,692
43,155
108
542,242
13,546
14,323
1,007
3,426
4,896
4,964
3,409
1,401
5,005
4,883
3,293
1,401
869,972 ;1,028,127 j1,154,703
470,054
374,231
58,155 ! 12,477
15,961
19,545
6,899 ! 3,210
CAPITAL ACCOUNTS
Capital paid in
Surplus (sec. 7)
Surplus (sec. 13b)
Other capital accounts
Total liabilities and capital accounts
Contingent liability on bills purchased for foreign
correspondents
Commitments to make industrial advances
12,879,630
1,666
12,928
15,580,6
14,272
9,411
10,083
2,874 i
1,448 I
In actual circulation *
For footnote see end of table.
12.258
13,466
4,411
2,000
968,247
4,635,428
6,276,548
790,418
124
1,671
6
1,297
582
4,755
-27
2,677
166
173
12,213
13,696
4,416
2,000
7
1,525
13,036 !
14,323 I
1,007 !
3,176 i
156 j
753 !
519,200
556,924
7
2,234
73
1,623
3
1,282
|
4,661,627
378,016
4,790,047
338,223
322,502
37,089
408,865 i 1,089,215 ! 1,134,257
24,735 | 124,313 j 104,961
340,801
22,766
340.668 ! 464,655 j 451,834
20,106 j 31,327 | 24,367
226,302
16,397
222,006
13,719
4,283,611
4,451,824
285,413
384,130
318,035
320,562 • 433,328
427,467
209,905
208,287
4,888,000
3,397
341,000
589
420,000
345,000 ! 467,000 ! 457,000
827 !
568 j
232
226,000
595
230,000
207
4,891,397
341,589
420,036 i 1,103,085
1,155,997 I 348,767 i 345,827 j 467,568 j 457,232
226,595
230,207
Collateral held by agent for notes issued to banks:
Gold certificates on hand and due from U. S.
4,728,632
Treasury
1
8,954
Eligible paper
I
25,000
U. S. Government securities
Total collateral held
51,043 I
52,463 I
7,457 I
8,210
800,453
FEDERAL RESERVE NOTE STATEMENT
Federal Reserve notes:
Issued to Federal Reserve bank by Federal Reserve
agent
Held by Federal Reserve bank
-
51,058
51,943
7,744
8,210
4,762,586
964,902
1,029,296
1,100,000 i 1,155,000 I 347,000
1,767
3,085
997
No. 3.—STATEMENT OF CONDITION OF EACH FEDERAL RESERVE BANK AT END OF 1937 AND 1938—Continued
[In thousands of dollars]
1937
1938
1938
1937
1937
1938
1937
Kansas City
Minneapolis
St. Louis
Chicago
Atlanta
1938
1937
Dallas
1938
1937
San Francisco
1938
1937
1938
ASSETS
Gfold certificates on hand and due from U.S. Treasury.. 230 573 275 267 1,760,008 2, 200, 214 282 455 316 ,830 185, 747 241,452 266,709 304,342 181,832 210, 498 681,843
543
509
606
236
446
191 1,180
629
843
1 ,535
583
695
792
Redemption fund—Federal Reserve notes
7,786 24,560 14,773 14,149 14, 400 32,176
19 ,634
Other cash
17,174 15 526
43,691
51, 557 16 ,105
9, 672
Total reserves
249 ,282 291 ,376 1,804,394 2, 252, 400 299 ,352 337 ,307 165, 865 249,844 291,812 319,624 196,217 225, 089 715,199
Bills discounted:
Secured by U. S. Government obligations direct or
fully guaranteed
Other bills discounted
399
638
111
150
79
55
74
Total bills discounted
Bills bought in open market
Industrial advances
960
19
128
186
19
825
229
65
70C
32 8Q9
50.559
28 ,780
34 ,979
47 163
23 ,080
U. S. Government securities:
Bonds
Treasury notes
Treasury bills
TotalU. S. Government securities
Total bills and securities . . . .
Due from foreign banks
Federal Reserve notes of other Federal Reserve banks
Uncollected items
Bank premises
Other assets
Total assets . . . .
7*
775,865
1,690
29,612
807,167
1
45
175
43
91
154
932
74
567
17
26
4
20
145
13
63
34
199
68
415
93
3
237
45
2
21
175
2
637
134
2
964
1,086
16
464
641
16
268
43
16
946
94
16
775
158
38
1,522
' 97
39
1,348
82,655
127,026
72,310
90 644
194 714
61, 031
969
50 ,670
28 ,844
35 on
48 187
23 ,581
94, 339
37 399
21, 285
18,633
25,636
12,546
36,717
56,426
32,120
37,140
51,101
25,007
29,231
44,926
25,574
30 913 65,059
49, 531 99,986
20, 814 56,917
66,476
91,463
44,758
112 ,238 104 ,522
281,991
276, 389 112 ,483 106 ,791
83, 009
56,815 125,263 113,248
99,731
94, 258 221,962
202,697
113 345 105 55?
6
6
3 ,443
, 3,536
1
94 953 94 887
2 ,076
! 2,119
1,504
1 ,809
282,985
21
4,47G
86,688
4,589
3,332
977 001 11 9 746 106 ,859
21
3
3
1 ,973
2 ,931
5, 886
95 915 98 ,770 99 838
2 ,291
2 ,341
3, 964
1 ,679
1 ,367
4, 349
83, 893
2
1, 920
18 078
1, 477
1, 229
57,915 126,829 114,173 100,736
2
5
5
5
1,531
1,428
1,453
1,025
16,889 36,463 32,624 27,981
1,524
3,159
3,089
1,281
1,572
1,779
1,096
1,369
95, 073 223,680
13
5
1, 308 3,520
95 699 36,863
1, 261 3,346
1, 565 3,228
204,181
12
3,034
32,073
3,243
3,627
99
394 ,745 429 ,149 2,186,479 2, 639, 536 446 ,552 480 ,908 302, 394 328,698 461,371 472,747 328,614 349, 923 985,849 1,053,337
F
3d
O
O
2
2
o
LIABILITIES
Federal Reserve notes in actual circulation1.
Deposits:
Member bank—reserve account
U. S. Treasurer—general account
Foreign bank
Other deposits
Total deposits
Deferred availability items
Other liabilities including accrued dividends.
Total liabilities
162,016 151,3981
993,3621
996,72l| 182,088 183,131! 137,570 136,857 167,924 171,390
,374j
81,375 342,694)
361,210
181,212 188,709 1,011,438 1,299,880 204,984 209,543 126,011 113,568 233,775 227,796 190,570| 183,468 549,,0371 564,765
46,810
4,004! 38,428 10,964!
6,396 41,110
27,967
4,339 43,294
9,086 24,886
176,765|
8,779 35,3i
14,160
5,784
5,03l|
5,784 12,317i
5,983)
6,072 6,980
20.124
3,990
5,031
23,734! 5,2051
4r
13,762
5,093
1,476
2,677
2, "" 16,645i
2,201
2,499
3,228
3,779
420
4,168
1,658! 5,817
195,881 240,967
24,126 24,190
362
153
1,502,0371 224,785 255,974! 137,568 165,228 248,312 259,942 202,282 230,366 588,963! 639,497
96,322 29,282 31,361 18,082 17,480 35,254 31,468 29.003J 27,254 30,036! 28.070
46
126
37
184! 122
199
102
51
1781 95
101
382,385
2,595,279 436,257 470,517! 293,398 319,660 451,591 462,846 317,785 339,032 961,877:1,028,899
CAPITAL ACCOUNTS
Capital paid in
Surplus (sec. 7)
Surplus (sec. 13b)
Other capital accounts
Total liabilities and capital accounts
Contingent liability on bills purchased for foreign
correspondents
Commitments to make industrial advances
4,401
5,626
730
1,603
4,495
5,630
713!
1,603
12,920
22,387
1,429
7,340
13,488
22,666
1,429
6,674
3,!
4,667
545
1,215
3,946|
4,685|
545
1,215;
2,893
3,153
1,001
1,949
2,903
3,153
1,001
1,981
4,091
3,613
1,142
934
4,212
3,613
1,142
934
3,891!
3,892j
1,270
1,776'
3,961 10,046i
3,892 9,805i
l,266i 2,1211
1,772| 2,000
10,352
9,965
2,121
2,000
394,745 429,1491 2,186,479 2,639,536 446,552 480,9081 302,394! 328,698; 461,37l! 472,747 328,614! 349,923 985,849)1,053,337
59
345
3
157...
197
9
58
51
176
2
548
2|
212!
49
111
121 j
3,001,
2
658
6
3,578
Federal Reserve notes:
Issued to Federal Reserve bank by Federal Reserve
agent
Held by Federal Reserve bank
In actual circulation 1...
Collateral held by agent for notes issued to banks:
Gold certificates on hand and due from U. S.
Treasury
Eligible paper
U. S. Government securities
Total collateral held...
1
182,457, 166,266 1,027,633
34,271
20,441 14,868
1,031,415 197,086 200,495 142,887 142,702 178,936 180,418
9,028
5,845 11,012
34,694 14,'— 17,364
5,317
86,374
81,375 342,694
361,210
166,000 169,000 l,055,00G 1,050,000 200,632 207,000! 140,500 143,500 182,000 185,000
731
1571
229|
129
23
I
99
1,067
82
627
5,000
20,000
9,500
43
92,500 404,000
24
158
434,000
79
99,543|
92,5241404,158!
434,079
993,362
6,721 182,0
183,13l| 137,570 136,857
97,094! 89,921 392,059; 421,200
10,720| 8,546 49,365i 59,990
167,924 171,390
162,016 151,398
186,731 169,157 1,055,2291 1,050,129 200,655 207,000 145,599| 143,582| 183,067 185,6
Includes Federal Reserve notes held by the U . S . Treasury or by a Federal Reserve bank other t h a n the issuing bank.
on
EC
FEDERAL RESERVE NOTE STATEMENT
&
53
FEDERAL RESERVE SYSTEM
No. 4.—VOLUME OF OPERATIONS IN PRINCIPAL DEPARTMENTS
O F FEDERAL RESERVE BANKS,
1934-1938
[Number in thousands; amounts in thousands of dollars]
1934
1935
1936
1937
1938
NUMBER OF PIECES HANDLED i
Bills discounted:
Applications
Notes discounted
Advances made
Industrial advances:
Advances made
Commitments to make industrial advances
Bills purchased in open market for own account
Currency received and counted
Coin received and counted
Checks handled
Collection items handled:
U. S. Government coupons paid 2
All other
Issues, redemptions, and exchanges b y fiscal
agency department:
U. S. Government direct obligations
Allother
Transfer of funds
.6
2,067,835
2,565,164
818,847
2
2,148,485
2,590,859
885,190
1
232,980
665,190
009,264
2,257,892
2,730,387
1,044,553
.2
2,089,987
2,676,248
1,098,115
21,555
7,436
22,633
7,119
18,806
6,968
18,566
6,705
17,802
6,389
5,281
(3)
1,125
6,838
3,742
982
27,919
1,538
951
661
980
3,456
575
853
AMOUNTS HANDLED
Bills discounted:
Notes discounted
45,781
9,622
6,886
16,187
Advances made
219,924
668,580
160,714
516,852
Industrial advances:
Advances made
14,884
28,479
8,519
4,932
Commitments to make industrial advances
11,443
29,223
12,583
6,978
Bills purchased in open market for own account
75,903
31,446
25,207
25,252
Currency received and counted
9,932,601
9,837,681 10,059,637 10,199,559
Coin received and counted
298,297
275,608
276,323
287,708
Checks handled
179,544,488 202,989,742 234,417,787 255,453,609
Collection items handled:
699,325
751,916
U. S. Government coupons paid 2
798,925
865,465
7,948,641
6,742,974
All other
7,089,008
6,159,828
Issues, redemptions, and exchanges b y fiscal
agency department:
29,941,049 30,755,611 25,198,825 19,304,020
U. S. Government direct obligations
3,346,189
Allother
2,223,136
1,691,863
73,077,156 80,483,190 87,001,630 94,596,861
Transfer of funds
,
1
2
3
2 or more checks, coupons, etc., handled as a single item are counted as 1 "piece."
Includes coupons from obligations guaranteed by the United States.
Figures not available.
10,472
226,687
6,500
11,217
2,781
8.883,728
271,128
232,090,217
854,273
5,321,443
24,450,791
2,581,611
82,219,749
No. 5.—EARNINGS AND EXPENSES OF FEDERAL RESERVE BANKS DURING
Boston
Tot;
New
York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
1938
St.
Louis
Minneapolis
City
Dallas
Francisco
CURRENT EARNINGS
ed bills
id bills
yernment securities.
il advances
ments to make industrial ad-
$123 ,751
9
34 ,446 ,249
830
60Q
695 ,397
tal current earnings
36 ,261 ,428
$3,522
$26,303
$9,042
$12,995
$27,125
$10,200
$2,895
$7 ,927
$8,675
$2,659
$4,800
$7,608
9
268
112
325
197
1,025
240
91
76
185
7
76
2, 558,374 10, 331,266 2 ,936,032 3 ,350,196 1 ,762,671 1 ,459,159 3 ,747,602 1 ,528,595 1 ,018,540 1 ,645 ,531 1 ,267,076 2 ,841,207
9,032
27,192
168,118
38,490
82,454
9,096
52,880
j271
105,641
201,166
68,285
48,186
11,158
6,138
41,053
104,713
1,565
18,804
15,267
76,228
15,075
46,598
1,042
19,870
293
175,092
5,857
17,826
1,704
24,682
11 ,851
154 ,799
1,445
8,873
56,299
41,774
2, 690,183 10, 706,348 3 ,151,090 3 ,490,621 1 ,915,952 1 ,502,189 3 ,954,026 1 ,564,278 1 ,100,472 1 ,840 ,455 1 ,330,456 3 ,015,358
CURRENT EXPENSES
g expenses:
:ies:
Officers
employees.
•ement System contribuns for current service
lfees
Jtors' fees and expenses
ral Advisory Council, fees
d expenses
eling expenses (other than of
•ectors and members of Fedd Advisory Council)
a,ge and expressage
Dhone and telegraph
ting, stationery and supplies.
ranee on currency and serity shipments
r insurance
s on bank premises
eciation on bank building
t, heat, power, and wrater
irs and alterations to bank
ilding
$516,911 $123,519 $172,449
4,388,286 1,278,294 1,505,268
69,309
80,631
55,535
240,453
9,956
10,006
14,999
62,104
7,065
7,546
6,004
$2,280,757 $117,000
16,632,415 1,063,791
923,714
140,002
136,715
$139,904
941,228
$154,619 $252,949
875,447 2,015,279
$177,875
904,777
$105,113
531,072
$168,321
895,756
53,854
274
7,186
46,326
3,573
15,360
109,228
636
6,867
54,701
5,000
11,991
31,547
11,852
11,765
56,647
1,022
23,405
$132,800 $219,297
872,769 1,360,448
47,276
78,207
9,222
11,358
7,816
18,826
750
740
723
893
1,021
1,350
1,261
1,197
1,398
3,350
47,296
542,002
93,082
141,237
26,109
277,260
30,341
23,148
253,756
27,160
45,755
21,833
196,795
44,190
48,443
29.589
388,481
30,566
77,331
22,744
151,812
34,161
42,766
25,914
122,:
18,555
13,846
216,027
42,951
44,797
12,915
162,322
34,347
42,916
25,527
269,066
48,723
64,524
35,282
16,851
156,114
55,832
28,165
41,985
42,172
439,425
198,027
60,586
25,265
20,779
69,767
126,532
34,922
16,771
15,080
68,014
79,502
22,1
12,366
16,934
59,318
42,548
22,285
24,486
20,392
169,552
139,953
40,810
5,442
19,196
53,251
51,206
22,032
7,208
18,878
69,270
27,424
16,981
9,181
22,882
90,960
72,696
30,252
7,667
16,724
32,388
68,648
21,026
23,747
21,109
99,247
103,124
25,099
135,499
2,381
152,154
34
450,685
31,147
iture and equipment
588,300
32,517
ther
tal operating expenses
29,645,149 2,081,235
reimbursements for certain
;al agency and other expenses.. 4,088,200
205,027
21,720
11,143
782
33,184
66,121
25,047
291,"""
45,303
69,612
20,692
17,556
125,822
206,448
43,632
9,697
73,075
17,755
45,735
4,253
16,482
8,375
31,246
23,166
4,359
113,514
55,810
9,556
"72^ 893
75,968
12,000
3,120
16,447
40,936
11,855
375
12,726
33,462
8,126
127
24,556
35,399
6,155
1,680
35,791
38,526
15,447
52,120
14,431
65,210
14,712
1,160
288,7'
3,225,927
472,249
751,650
14,831
354,273
22,870
72,449
230,092
248,553
1,433,128
1,171,940
367,858
69,866
67,370
6,986,275 2,281,080 2,768,879 1,754,779 1,757,779 3,465,557 1,630,807 1,089,364 1,758,148 1,552,386 2,518,860
632,559
203,576
262,468
239,530
507,636
607,435
339,597
168,163
211,130
448,329
262,750
w
o
>
O
o
ia
125
o
w
w
Net operating expenses
Assessment for expenses of Board of
Governors
Federal Reserve currency:
Original cost
Cost of redemption
Total current expenses
25,556,949| 1,876,208
6,353,716 2,077,504 2,506,411 1,515,249 1,250,143 2,858,122 1,291,210
921,201 1,547,018 1,104,057 2,256,110
1,724,924
123,925
618,656
168,420
159,503
74,329
60,262
206,080
50,857
39,436
49,634
50,734
123,088
1,449,692
180,043
154,418
11,117
326.467
36,960
139,334
12,595
116,599
15,145
87,177
12,460
61,997
15,733
226,993
26,807
63,239
9,961
46,619
4,667
57,558
8,270
27,802
9,353
141,489
16,975
28,911,608
2,165,668
7,335,799 2,397,853 2,797,658 1,689,215
,135 3,318,002 1,415,267 1,011,923 1,662,480 1,191,946 2,537,662
PROFIT AND LOSS
Current earnings (above)
Current expenses (above)
Current net earnings
Additions to current net earnings:
Profits on sales of U. S. Government securities
Allother
Total
Deductions from current net earnings:
Losses and reserves for losses on
industrial advances (net)
Special reserves and charge-offs
on bank premises
Prior service contributions to
Retirement System (final payment)
Allother
Total
36,261,428
28,911,608
2,690,183 10,706,348 3,151,090
2,165,668 7,335,799 2,397,853
3,490,621 1,915,952 1,502,189 3,954,026 1,564,278 1,100,472 1,840,455 1,330,456 3,015,358
2,797,658 1,089,215 1,388,135 3,318,002 1,415,26: 1,011,923 1,662,480 1,191,946 2,537,662
7,349,820
524,511
3,370,549
753,237
#2,963
226,737
114,054
636,024
149,011
88,549
177,975
138,510
477,696
8.275,
1,551,356
594,408
57,864
2,316,015
82,600
696,803
23,632
816,488
22,460
437,837
33,882
355,444
370,
932,997
704,144
385,083
10,532
281,351
203,930
416,446
8,028
324,310
15,736
718,715
17,865
9,827,253
652,272
2,398,615
720,435
8,948
471,719
726,127 1,637,141
395,615
485,281
424,474
340,046
736,580
847,715
69,145
448,500
30,000
20,000
161,248
27,500
45,418
736,840
1,579,749
5,045,756
121,"""
357,600
515
1,282,107
11,046
386
3
439,812
22,473
7,595,119
427,260
2,478,493
420,'
482,285
Net additions to current net earnings..,
2,232,134
225,012
-79,878
299,'
356,663
Net earnings
9,581,954
749,527
PaidU. S. Treasury (sec. 13b)
119,524
8,019,137
Dividends paid
-419,140
Transferred to surplus (sec. 13b)
1,862,433
Transferred to surplus (sec. 7)
Surplus (sec. 7), Jan. 1,1938
147.737,758
Addition, as above
1,862,433
Transferred to reserves for contin-448,835
gencies
1,544
564,:
Surplus (sec. 7), Dec. 31, 1938
3,290,671 1,052,956 1,049,626
3,056,972
-286,745
520,444
83
734
4
229
1,899,737 51,942,505 13,465
520,444
229
183,614
22'
799,145
250,254
20,904
25,000
9,163
317,597
516,149
187,6
60,2
665,997
61
289,800
219
166,088
281
341,520
239
218,616
180
395,496
577
1,182,207
290,019
200,532
341,759
246,296
441,491
454,934
105,596
284,749
82,715
93,750
295,089
200,875
253,701 1,090,958
254,607
373,298
260,690
232,260
772,785
297,732
-115,893
19,036
20,714
791,007
206
279,031
1,796
234,488
1,005
174,231
10,270
249,901
236,294
-4,034
613,068
18,323
198,062
519
314,088
22,245
497,581
-25,8
139,647
267,368
-17,409
3,742
4,322,790 4,963,636 5,625,948 22,386,972 4,667,175 3,153,414
250,254
198,062
3,742
279,031
19,036
18,323
-250,254
149,151,356 10,083,351 52,462,949, 13,695,587J14,322,790J 4,982,6721 5,629,690 22,666,003 4,685,4
-198,062
,612,681 3,891,870i 1,805,134
519
159,717
-519
3,153,414 3,612,681
3,891,870 1,964,851
OX
No.
6.—CURRENT EARNINGS, CURRENT EXPENSES, AND NET EARNINGS OF FEDERAL RESERVE BANKS AND DISPOSITION OF NET
EARNINGS, 1914-1938
Federal Reserve bank
1
Earnings and expenses
Current earnings
All F e d e r a l Reserve b a n k s :
1914-15
1916
1917
1918
1919
Current
expenses
Disposition of net earnings
\
Net earnings
J
Dividends
paid
Franchise tax
paid to U. S.
Treasury 2
Paid to U. S.
Treasury
(Sec. 13b)
Transferred
to surplus
(Sec. 13b)
Transferred
to surplus
(Sec. 7)
2,173,252
5,217,998
16,128,339
67,584,417
102,380,583
2,320,586
2,273,999
5,159,727
10,959,533
19,339,633
-141,459
2,750,998
9,579,607
52,716,310
78,367,504
217,463
1,742,774
6,801,726
5,540,684
5,011,832
2,703,894J
1 134 234
48,334,341
70,651,778
1920
1921
1922
1923
1924
181,296,711
122,865,866
50,498,699
50,708,566
38,340,449
28,258,030
34,463,845
29,559,049
29,764,173
28,431,126
149,294,774
82,087,225
16,497,736
12,711,286
3,718,180
5,654,018
6,119,673
6,307,035
6,552,717
6,682,496
60.724.742
5Q Q74.4fifi
10,850,605
3,613,056
113,646
82,916,014
15,993,086
-659,904
2,545,513
-3,077,962
1925
1926
1927
1928
1929
41,800,706
47,599,595
43,024,484
64,052,860
70,955,496
27,528,163
27,350,182
27,518,443
26,904,810
29,691,113
9,449,066
16,611,745
13,048,249
32,122,021
36,402,741
6,915,958
7,329,169
7,754,539
8,458,463
9,583,913
59,300
818,150
249,591
2,584,659
4,283,231
2,473,808
8,464,426
5,044,119
21,078,899
22,535,597
1930
1931
1932
1933
1934
36,424,044
29,701,279
50,018,817
49,487,318
48,902,813
28,342,726
27,040,664
26,291,381
29,222,837
29,241,396
7,988,182
2,972,066
22,314,244
7,957,407
15,231,409
10.268.598
10.029,760
9.282.244
8,874,262
8,781,661
17,308
-60,323
-2,297,724
-7,057,694
11,020,582
-916,855
6,510,071
1935
1936
1937
1938
42,751,959
37,900,639
41,233,135
36,261,428
31,577,443
29,874,023
28,800,614
28,911,608
9,437,125
8,512,433
10,801,247
9,581,954
27,062
102,880
67,304
-419,140
607,422
352,524
2,616,352
1,862,433
1,277,309,453
588,825,104
610,012,050
-282,217
290,131,060
....
Total—1914-1938
1 134 234
2|6iiJ4is
8,504,974
7,829,581 !
7,940,966
8,019,137
170,203,643 1 149.138.300
297,667
227,448
176,625
119,524
821,264
4
Direct
charges
to surplus
(Sec. 7)3
PI
o
cd
500,000
o
5d
o
139,299,557
731^313'
448,835
140,979,705
Aggregate for each Federal Reserve bank 19141938:
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
KansasCity
Dallas.....
San Francisco
1
Current earnings
2
The Banking Act
3
85,713,786 1
376,149,532 |
99,677,356 1
113,480,456 j
60,681,223
59,931,097 j
178,283,567 i
55,002,897 I
41,561,657 I
61,081,497 1
45,302.840 i
100,443,545 !
42,448 ,433
142,847 ,720
44,929 ,839
54,093 ,484
31,851 ,115
27,234 ,959
77,374 ,851
30,273 ,117
21,719 ,217
36,191 ,932
26.685 ,104
53,175 ,333
|
|
|
!
40,019, 745
219,350, 873
50,824. 882
51,046! 564
24,260, 350
25,912, 854
87,984, 849
18,886. 921
17,013. 462
20,601, 670
14,425. 102
39,684, 778
12,506,225
56,564,019
16,438,106
17,161,031
7,330,372
6,095,809
20,150,063
6,231,290
4,339,764
5,810,201
5,526,091
12,050,672
7,111,395
68,006,262
5,558,901
4,842,447
6,200,189
8,950,561
25,313,526
2,755,629
5,202,900
6,939,100
560,049
7,697,341
91,692
82,987
293,888
36,868
66,714
9,066
95,059
5,948
34,319
31,223
73,500
-3,155
-294,553
217,517
-8,156
-127,888
-44,304
11,681
-1,505
-6,583
-3,622
14,255
-35,904
20,313,588
94,992,158
28,316,470
29,014,374
10,790,963
10,901,722
42,414,520
9,895,559
7,443,062
7,824,768
8,251,207
19,972,669
10,230,237
42,529,211
14.620,883
14,691,585
5,808,291
5,272,032
19,748,517
5,210,059
4,289,648
4.212,086
4,359,338
10,007,818
less current expenses, plus other additions and less other deductions.
of 1933 eliminated the provision in the Federal Reserve Act requiring payment of a franchise tax.
Direct charges to surplus (sec. 7) represent amounts transferred to reserves for contingencies, except as follows: 1927—$500,000, depreciation on bank premises; 1934—$139,299,557, cost
of Federal Deposit Insurance Corporation stock purchased by Federal Reserve banks.
4
In 1935 the Federal Reserve Bank of Boston credited $1,810 and the Federal Reserve Bank of St. Louis charged $1,176 direct to surplus (sec. 13b). Total payments received from the Secretary of the Treasury under section 13b of the Federal Reserve Act to the end of 1938 and credited to surplus (sec. 13b) amounted to $27,546,311.
58
ANNUAL REPORT OF BOARD OF GOVERNORS
No. 7.—FEDERAL RESERVE BANK DISCOUNT, INTEREST, AND COMMITMENT RATES AND
BUYING RATES ON ACCEPTANCES
(Percent per annum]
In effect December 31, 1938
Boston
Rediscounts for and advances to member banks
under sees. 13 and 13a of
the Federal Reserve Act 1 .. IX
Advances to member banks
under sec. 10(b) of the
Federal Reserve Act
2
Advances to individuals,
partnerships or corporations, secured by direct
obligations of the United
States (last paragraph of
sec. 13 of the Federal Reserve Act)
Advances direct to industrial or commercial organizations under sec. 13b
of the Federal Reserve Act 33/2-6
Advances to financing institutions under sec. 13b
of the Federal Reserve Act.
On portion for which
institution is obligated
3
On remaining portion..
Commitments to make advances under sec. 13b of
the Federal Reserve Act... li-l
Minimum buying rates on
prime bankers' acceptances payable in dollars.. (6)
1-15 days*
16- 30 days
31- 45 days
46- 60 days
61- 90 days
91-120 days
121-180 days
1
Rates indicated
2
Authorized rate
3
New PhilaRich- Atdel- CleveYork phia
land mond lanta
1
IX
IX
2
2
2
4
3K
2
2
2
2V2
4
3^
4-6
4-6
5
5
(2)2K
5-6
1
1-2
x
6
()
1-2
(3)
()
ix
5-6
3
4-5
""x
ix
5-6
4-6 4^-6
6
4
\lA
6
4-6
1-2 H-2
ix
Min- KanSan
Chi- St. neapsas Dallas Francago Louis olis City
cisco
6
()
6
()
6
()
IX
IX
IX
2
2
2
2
4
3
2y2
2M
4
4-5M
6
v/2 4^-5
4-6
5-6
4
4
5-6
3-4
4-5
1
X-2
(6)
(6)
4^-5.
4
WX
(6)
5-6
4
1
4
( )J4-2
6
()
fi
()
X
Y2
X
Z
A
also apply to United States Government securities bought under repurchase agreement.
1 percent above prevailing discount rate.
Same as to borrower but not less than 4 percent.
«Flat charge.
5
This rate also applies to acceptances bought under repurchase agreement, which agreements are always
for6 a period of 15 days or less.
The same minimum rates in effect at the Federal Reserve Bank of New York apply to purchases, if any,
made by other Federal Reserve Banks.
59
FEDERAL RESERVE SYSTEM
No. 8.—MAXIMUM RATES ON TIME DEPOSITS
Maximum rates that may be paid by member banks as established by the Board of Governors under provisions
of Regulation Q
[Percent per annum]
Nov. 1, 1933, Feb. 1, 1935,
to
to
Jan. 31, 1935 Dec. 31, 1935
Savings deposits
Postal Savings deposits
Other time deposits payable in:
6 months or more
90 days to 6 months
Less than 90 days
In effect
beginning
Jan. 1, 1936
2H
2H
NOTE.—Maximum rates that may be paid by insured nonmember banks as established by the Federal Deposit
Insurance Corporation, effective February 1, 1936, are the same as those in effect for member banks. In
some States the maximum rates established by the Board and the Federal Deposit Insurance Corporation are
superseded by lower maximum rates established by State authority.
60
ANNUAL REPORT OF BOARD OF GOVERNORS
N o . 9 . — M E M B E R B A N K R E S E R V E REQUIREMENTS
[Percent of deposits]
Classes of deposits and banks
On net demand deposits:
Central reserve city..
Reserve city
Country
On time deposits:
All member banks...
June 21, 1917Aug. 15, 1936
Aug. 16, 1936- Mar. 1, 1937- May 1, 1937- Apr. 16, 1938Feb. 28, 1937 Apr. 30, 1937 Apr. 15, 1938
and after
12M
12
5
61
FEDERAL RESERVE SYSTEM
No. 10.—MEMBER BANK RESERVE BALANCES, RESERVE BANK CREDIT, AND RELATED
ITEMS—END OF YEAR 1918-1938 AND END OF MONTH 1938
[In millions of dollars]
Member
bank reserve
balances
Reserve bank credit mtstanding
End of
year
or month
U.S.
Bills
Govdis- Bills erncount- bought ment
secured
ities
Treasury
Treas- Treasury
cur- Money ury
in
cash deposits
Gold rency
Other
stock 2 out- circu- hold-4 with
Restandlation ings F. R.
serve Total
banks
ing 3
bank
credit i
Non- Other
mem- Federal
Reber
deserve
5
acExposits
counts 6 Total cess7
1918
1919
1920
1921
1,766
2,215
2,687
1,144
287
574
260
145
239
300
287
234
206
203
120
40
2,498
3,292
3,355
1,563
2,873
2,707
2,639
3,373
1,795
1,707
1,709
1,842
4,951
5,091
5,325
4,403
288
385
218
214
51
31
57
96
121
101
23
27
118
208
298
285
1,636
1,890
1,781
1,753
"99
1922
1923
1924
1925
618
723
320
643
272
355
387
374
436
134
540
375
79
27
54
67
1.405
1,238
1,302
L,459
3,642
3,957
4,212
4,112
1,958 4,530
2,009 4,757
2,025 4,760
1,977 4,817
225
213
211
203
11
38
51
16
29
23
39
29
276
275
258
272
1,934
1,898
2,220
2,212
14
59
—44
637
582
315
617
228
511
49
64
35
48
1,381
1,655
1,809
1,583
4,205
4,092
3,854
3,997
1,991 4,808
2,006 4,716
2,012 4,686
2,022 4,578
201
208
202
216
17
18
23
29
65
26
27
30
293
301
348
393
2,194
2,487
2,389
2,355
—56
63
—41
—73
729
817
29
59
22
20
1,373
1,853
2,145
2,688
4,306
4,173
4,226
4,036
2,027 4,603
2,035 5,360
2,204 5,388
2,303 5,519
211
222
272
284
19
54
8
3
28
110
43
132
375
354
355
360
2,471
1,961
2,509
2,729
96
-33
576
859
20
45
64
38
2,463
2,486
2,500
2,612
2,593
2,590
2,611
2,594
2,582
2,596
2,589
2,585
2,600
2,586
2,584
2,601
8,238
10,125
11,258
12,760
12,756
12,776
12,795
12,869
12,919
12,963
13,017
13,136
13,760
14,065
14,312
14,512
3,029
2,566
2,376
3,619
3,648
3,594
3,550
2,195
2,263
2,303
2,348
2,480
2,810
2,770
2,689
2,706
121
544
244
142
189
255
259
407
241
253
261
263
4,096
5,587
6,606
7,027
1,814
2,844
1,984
1,212
150
180
316
388
423
315
355
390
363
384
313
356
424
574
441
260
257
262
263
261
261
257
255
260
260
259
260
7,237
7,248
7,287
7,623
7,665
8,024
8,164
8,179
8,198
8,713
8,876
8,724
1,383
1,415
1,546
2,548
2,568
2,875
3,022
2,941
2,869
3,227
3,383
3,205
1926
1927
1928
1929
632
381
392
489
392
1930
1931
1932
1933
251
638
235
98
364
339
33
133
1934
1935
1936
1937
7
5
6
5
10
1
12
10
13
9
9
8
7;
7
8
7
7
4
1
1,056
. .
1938 Jan...
Feb. .
Mar..
Apr. .
May .
June.
July.
Aug. .
Sept..
Oct. .
Nov..
Dec. .
1
1
1
1
1
1
1
1
1
1
1,855
2,437
2,430
2,431
2,430
2,564
2,564
2,564 :
2,580 2,564
2,564
2,564
2,564
2,564
2,563
2,564
2,564
2,564
16
15
17
21
9
23
18
14
29
14
13
33
2,511
2,476
2,532
2,637
2,655
2,668
2,679
2,690
2,702
2,713
2,721
2,731
2,739
2,751
2,773
2,798
5,536
5,882
6,543
6,550
6,320
6,334
6,355
6,397
6,467
6,461
6,452
6,504
6,622
6,700
8,787
6,856
1,320
1,157
860
721
720
853
535
484
923
51
68
1
Includes Government overdrafts in 1918, 1919, and 1920; includes industrial advances outstanding since
July
1934.
2
By proclamation of the President, dated January 31, 1934, the weight of the gold dollar was reduced from
25 8/10 grains to 15 5/21 grains, nine-tenths fine. Between January 31, 1934, and February 1, 1934, the gold
stock increased $2,985,000,000, of which $2,806,000,000 was the increment resulting from the reduction in the
weight of the gold dollar and the remainder was gold which had been purchased by the Treasury previously
but not added to the gold stock. The increment was covered into the Treasury as a miscellaneous receipt, and
appeared together with the new gold as a General Fund asset. These transactions were also reflected in an
increase in the item "Treasury cash." The increment arising from United States gold coin turned in by the
public after January 31, 1934, was also added to both gold stock and Treasury cash at the time of receipt. The
increment from this source amounted to about $7,000,000, from February 1 to December 31, 1934, to about
$1,000,000
in 1935, to $1,800,000 in 1936, to $1,200,000 in 1937, and to $500,000 in 1938.
3
Comprises outstanding United States notes, national bank notes, silver bullion, Treasury notes of 1890,
standard silver dollars, subsidiary silver and minor coin, and the Federal Reserve bank notes for the retirement of which lawful money has been deposited with the Treasurer of the United States, including the currency
of these kinds that is held in the Treasury and the Federal Reserve banks as well as that in circulation.
4
Cash (including gold bullion) held in the Treasury excepting (a) gold and silver held against gold and silver
certificates
and (b) amounts held for the Federal Reserve banks.
5
Item includes all deposits in Federal Reserve banks except Government deposits and member bank reserve
balances.
6
This item is derived from the condition statement of the Federal Reserve banks by adding capital, surplus,
other capital accounts, and "other liabilities, including accrued dividends," and subtracting the sum of
bank
premises and "other assets."
7
Represents excess of total reserve balances over reserves required to be held by member banks against their
deposits. Figures not available prior to 1929 except on call dates, and since April 1933 are for licensed member
banks only. For required reserves and changes in the percentages of requirements see table 9.
No. 11.—ALL MEMBER BANKS—CONDITION ON SEPTEMBER 28, 1938, BY CLASSES OF BANKS
[Amounts in thousands of dollars]
All
member
banks
All
national
member
banks
All
State
member
banks
12,937,437
10,712,818
2,298,477
5,678,157
31,626,889
112,965
968,380
335,567
8,192,978
774,887
42,488
1,583,009
2,234,373
77,156
73,374
1,261
1,460,367
8,235
27,633
1,370
198,227
8,279,991
6,894,508
1,566,795
3,765,510
20,506,804
56,935
629,412
152,284
4,666,085
567,053
28,911
1,182,828
1,759,255
61,776
34,001
1,261
893,143
6,074
7,576
Central reserve city
member banks
New York
Chicago
4,657,446
3,818,310
731,682
1,912,647
11,120,085
56,030
338,968
183,283
3,526,893
207,834
13,577
400,181
475,118
15,380
39,373
3,145,571
3,153,144
833,725
1,222,088
8,354,528
86,007
222,287
31,552
3,743,377
69,881
2,001
44,373
44,773
56,430
522,128
920,999
126,250
319,386
1,888,763
3,039
21,319
5,946
855,865
31,821
11,449
148,900
36,105
1,220
2,163
578,872
98,656
464
101,377
567,224
2,161
20,057
1,167
96,850
25,914
1,100
61,026
47,719,159
30,654,978
17,064,181
30,308,304
20,438,710
707,267
2,079,830
6,088,093
456,517
537,887
19,073,215
12,632,896
451,966
1,595,925
3,899,879
204,163
288,386
11,235,089
7,805,814
255,301
483,905
2,188,214
252,354
249,501
Reserve
city
member
banks
Country
member
banks
ASSETS
Loans (including overdrafts)
United States Government direct obligations
Securities fully guaranteed by United States Government
Other securities
T o t a l loans a n d i n v e s t m e n t s
Customers' liability on account of acceptances
Banking house, furniture, and fixtures
Other real estate owned
Reserve with Federal Reserve banks
Cash in vault
Balances with private banks and American branches of foreign banks
Demand balances with banks in New York City
Demand balances with other domestic banks
Time balances with other domestic banks
Balances with banks in foreign countries
Due from own foreign branches
Cash items in process of collection
Cash items not in process of collection
Acceptances of other banks and bills sold with endorsement
Securities borrowed
Other assets
Total assets
203
4,399,460
2,550,495
595,744
2,412,073
9,957,772
1,366
386,823
171,934
1,282,452
350,747
2,896
540,874
1,194,630
48,051
2,827
21
12
4,870,278
4,088,180
742,758
1,724,610
11,425,826
22,553
337,951
126,135
2,311,284
322,438
26,142
848,862
958,865
27,849
11,954
1,261
594,967
3,018
1,455
18,035
75,481
43,685
13,322,621
3,123,314
17,096,041
14,177,183
10,687,630
7,128,070
180,797
196,118
2,497,641
404,655
280,349
2,390,931
1,454,904
61,771
204,129
635,607
10,262
24,258
10,625,422
6,842,674
356,450
710,658
2,556,773
39,213
119,654
6,604,321
5,013,062
108,249
968,925
398,072
2,387
113,626
36
187^872
4,732
252
270
LIABILITIES
D e m a n d deposits—Total
Individuals, partnerships, and corporations
United States Government
States, counties, and municipalities
Banks in United States
Banks in foreign countries
Certified and officers' checks, cash letters of credit and travelers' checks, etc
Time deposits—Total
Individuals, partnerships, and corporations—
Evidenced by savings passbooks
Certificates of deposit
Open accounts
Christmas savings and similar accounts
Postal savings
States, counties, and municipalities
Banks in United States
Banks in foreign countries
11,462,315
7,974,726
3,487,589
722,749
459,483
4,576,591
5,703,492
9,398,613
724,377
544,378
121,292
69,605
464,427
130,009
9,614
6,573,099
560,373
250,453
85,015
59,697
340,467
97,788
7,834
2,825,514
164,004
293,925
36,277
9,908
123,960
32,221
1,780
402,455
29,253
214,242
7,177
390,256
14,849
32,554
944
"63^538'
210
5,874
20^850
30
3,736,540
194,849
236,912
40,824
23,258
233,228
107,240
3,740
4, 869,362
485,426
60,670
72,347
46,347
146,811
22,529
Total deposits
Secured by pledge of loans and/or investments
Not secured by pledge of loans and/or investments
41, H O , 619 27,047,941
2,759,620
2,045,399
39,010,999 25,002,542
14,722,678
714,221
14,008,457
11,410,379
367,895
11,042,484
2,850,414
217,783
2,632,631
15,202,013
1,316,044
13,885,969
12, 307,813
857,898
11, 449,915
12
2,514
773
M55
20,618
4,121
9^203
"47,325'
1^317
10,829
252
1,179
249
270
24,147
18,057
37,866
26,738
769,907
632,274
220,879
109,832
4,771
3,571
26,900
20,850
919,217
544,380
239,670
63,934
12,605
Due to own foreign branches
Agreements to repurchase securities sold
Bills payable and rediscounts
Acceptances of other banks and bills sold with endorsement
Acceptances executed for customers
Acceptances executed by other banks for reporting banks
Securities borrowed
Interest, taxes, and other expenses accrued and unpaid
Dividends declared but not yet payable and amounts set aside for undeclared dividends and
for accrued interest on capital notes and debentures
Other liabilities
Capital notes1and debentures
Capital stock (for par value see next table)
Surplus
Undivided profits—net
Reserves for contingencies
Retirement fund for preferred stock and capital notes and debentures
Total liabilities (including capital account)
Net demand deposits
Demand deposits—adjusted2
Number of banks
117,432
1,502
12,499
27,633
109,060
12,354
1,370
96,208
101,385
1,206
9,122
7,576
55,334
6,903
203
60,381
35,817
21,028
124,781
45,718
48,144
2,377,484 " i," 565^288'
2,046,844
1,124,903
645,543
432,133
274,395
163,074
17,474
12,783
16,047
296
3,377
20,057
53,726
5,451
1,167
35,827
14,789
79,063
48,144
812,196
921,941
213,410
111,321
4,691
117,432
185'
'"i',m
25,914
84,749
7,211
1,100
15,533
803
13,386
56,430
3,585
556
561,860 " " 126^500'
803,015
67,175
157,943
27,051
65,395
35,234
48
50
47,719,159
30,654,978
17,064,181
13,322,621
3,123,314
17,096,041
14, 177,183
25,038,348
21,596,060
6,341
15,240,703
13,624,064
5,239
9,797,645
7,971,996
1,102
10,019,612
7,025,665
36
2,107,796
1,584,635
13
8,225,937
7,078,019
344
4, 685,003
5,907,741
5,948
1
Represents in the ease of: National banks, (1) the par value of capital stock or (2) the net book value of the entire capital account, whichever was the smaller, as reported
by individual banks; State member banks with capital notes and debentures outstanding, (1) the par value of common stock or (2) the net book value of the entire capital account
less capital notes and debentures and reserves for contingencies and for retirement of capital notes and debentures, whichever was the smaller, as reported by individual banks;
State member banks which do not have capital notes and debentures outstanding, (1) the aggregate of the retirable value of preferred stock and the par value of common stock or
(2) the net book value of the entire capital account less reserves for contingencies and for retirement of preferred stock, whichever was the smaller, as reported by individual
banks.
2
Demand deposits other than interbank and United States Government, less cash items reported as in process of collection.
tarn
No. 12.—ALL MEMBER BANKS—CLASSIFICATION OF LOANS, INVESTMENTS, AND CAPITAL STOCK ON SEPTEMBER 28, 1938, BY
CLASSES OF BANKS
[In thousands of dollars]
Loans—Total
Acceptances of other banks payable in United States .
Bills, acceptances, etc., payable in foreign countries
Commercial paper bought in open market
Loans to banks
Loans on securities exclusive of loans to banks—Total
To brokers and dealers in New York
To brokers and dealers elsewhere .
Toothers
Real estate loans:
On farm land
On other real estate
Reporting banks' own acceptances .
All other loans (including overdrafts)
.
...
.
.
. .
United States Government direct obligations—Total
Treasury bonds maturing on or before December 31, 1949
Treasury bonds maturing after December 31, 1949
Other United States bonds
Treasury notes
Treasury bills
Securities fully guaranteed by U. S. Government—Total
Reconstruction Finance Corporation . . . . .
Federal F a r m Mortgage Corporation
Home Owners' Loan Corporation
Other Government corporations and agencies . . .
.
Central reserve city
member banks
Reserve
city
member
banks
Country
member
banks
522,128
4,870,278
4,399,460
122
450
14,798
111
5,817
8,758
99,285
21,944
2,072
1,200
150,506
8,548
1,265,945
142,900
1,088,518
805,059
347,040
76,706
1,023,510
512,143
51,654
702,148
31,445
111,455
12,037
84,126
992,355
7,159
14,244
783,656
222,159
1,437,105
67,851
4,409,789
53,061
948,929
44,067
1,954,364
131,480
64,512
1,499,290
9,674
2,871
350,986
95,440"
1,121,447
42,161
2,386,908
10,712,818
6,894,508
3,818,310
3,153,144
920,999
4,088,180
179,299
1,123,433
2,374
2,126,969
2,550,495
2 803,359
3,832,847
56,529
3,706,625
313,458
1,723,638
2,664,317
46,690
2,306,661
153,202
1,079,721
1,168,530
9,839
1,399,964
160,256
788,068
772,347
141,628
468,798
76
1,341,796
250,857
211
309,662
700
1,176,830
1,568,737
6,161
1,289,656
46,796
696,833
1,022,965
50,081
765,511
15,105
2,398,477
1,566,795
731,682
833,725
126,250
742,758
595,744
425,576
419,168
1,292,947
160,786
284,680
321,174
860,596
100,345
140,896
97,994
432,351
60,441
223,652
74,736
478,492
56,845
98,150
5,108
9,381
13,611
61,453
175,957
444,630
60,718
42,321
163,367
360,444
29,612
All
member
banks
All
national
member
banks
All
State
member
banks
New York
12,937,437
8,279,991
4,657,446
3,145,571
86,972
13,206
271,474
126,038
36,146
7,668
188,473
55,634
50,826
5,538
83,001
70,404
78,961
2,798
6,885
95,435
3,302,422
1,855,166
1,447,256
531,339
181,469
2,589,614
184,299
104 763
1,566,104
275,220
2,386,034
111,918
6,364,153
265
Chicago
216
3
w
Q
o
CO
Other securities—Total
Obligations of:
States, counties, municipalities, etc
Public utilities
. . .
..
Railroads
Federal land banks
...
Intermediate credit banks
Joint-stock land banks.
Territorial and insular possessions
Real estate corporations
.. .
Other domestic corporations
Stock of:
Federal Reserve banks
Real estate corporations
Banks and banking corporations
Other domestic corporations . . .
Foreign securities:
Central governments
Provincial, State, and municipal governments
Other foreign securities
Par value of capital stock—Total
First preferred *
Second preferred *
Common
..
..
.
. .
...
5,678,157
3,765,510
1,913,647
1,333,088
319,386
1,734,610
3,413,073
2,301,977
772,612
826,415
126,395
150,276
15,476
15,515
53,518
693,621
1,489,724
555,506
588,280
104,090
92,469
12,048
10,387
25,158
483,405
812,253
217,106
238,135
22,305
57,807
3,428
5,128
28,360
210,216
494,442
114,152
142,411
3,260
92,502
143,454
42,756
24,200
15,039
8,136
227
540
333
903
14,464
128,371
1,613
35,890
768,877
174,267
194,794
48,545
41,932
3,792
5,959
22,353
201,255
895,204
441,437
465,010
59,551
7,706
11,124
8,113
15,088
328,105
134,120
58,903
72,215
273,138
81,173
39,976
28,625
127,539
52,947
18,927
43,590
145,599
40,579
1,620
22,607
110,375
5,810
749
504
26,336
42,993
40,993
36,881
90,895
44,738
15,541
12,223
45,532
98,129
47,570
38,277
69,424
31,841
25,865
28,705
15,729
12,412
40,447
9,452
6,639
5,923
5,824
1,916
24,493
11,296
15,285
27,266
20,998
14,437
3,360,147
1,569,657
790,490
547,901
136,500
766,438
919,308
317,675
25,166
2,017,306
242,775
17,171
1,309,711
74,900
7,995
707,595
9,507
25,700
109,391
8,150
648,897
173,077
17,016
729,215
538^394' " " 100^800'
x
Retirable value exceeds par value, as follows: National banks, First preferred stock—by $18,088,000. Second preferred stock—by $1,860,000; State banks, First preferred stock—by
$37,177,000. Second preferred stock—by $2,552,000.
66
ANNUAL REPORT OF BOARD OF GOVERNORS
No. 13.—NUMBER OF BANKS AND BRANCHES IN UNITED STATES, 1933-1938
[Figures for 1938 are preliminary]
Member banks
End of year figures
Total
National
Nonmember banks
State
Other than mutual
savings and private
banks
Insured 1
1933
1934
1935
1936
1937
1938
NUMBER OF
BANKING OFFICES
Mutual
savings
Private 2
Not
insured 1
17,940
19,196
19,153
19,066
18,927
18,781
6,275
6,705
6,715
6,723
6,745
6,723
1,817
1,961
1,953
2,032
2,075
2,105
9 , 579
8,556
1,088
8,436
1,043
8,340
997
8,226
963
705
698
693
691
4
689
246
143
139
79
5 75
15,029
16,063
15,869
15,667
15,387
15,200
5,154
5,462
5,386
5,325
5,260
5,224
857
980
1,001
1,051
1,081
1,114
8, 341
1,108
7,693
7,728
1,046
7,588
1,004
7,449
'960
922
7,316
579
579
570
565
563
555
98
241
138
134
74
69
2,911
3,133
3,284
3,399
3,540
3,581
1,121
1,243
1,329
1,398
1,485
1,499
960
981
952
981
994
700
778
828
848
891
42
39
37
125
126
128
128
128
5
5
5
5
5
991
910
41
134
6
3
9, 041
704
103
NUMBER OF
BANKS (HEAD OFFICES)
1933
1934
1935
1936
1937
1938
NUMBER OF BRANCHES6
1933
1934
1935
1936
1937
1938
..
'Revised.
f e d e r a l deposit insurance did not become operative until January 1, 1934.
2 The figures for December 1934 include 140 private banks which reported to the Comptroller of the Currency
under the provisions of Section 21(a) of the Banking Act of 1933. Under the provisions of the Banking Act
of 1935, private banks no longer report to the Comptroller of the Currency and, accordingly, only such private
banks
as report to State banking departments are in the figures shown for subsequent years.
3
Separate figures not available for branches of insured and not insured banks.
4
Comprises 49 insured banks with 18 branches and 506 uninsured banks with 116 branches.
5
Comprises 2 insured banks with no branches and 67 uninsured banks with 6 branches.
e The number of branches in head-office cities and outside head-office cities, respectively, were as follows
1933
1934
1935
1936
1937
1938
In head-office cities
1,784
1,776
1,754
1,749
1,757
1,743
Outside head-office cities
1,127
1,357
1,530
1,650
1,783
1,838
67
FEDERAL RESERVE SYSTEM
N o . 14.—ANALYSIS OF CHANGES IN NUMBER OF BANKS AND BRANCHES D U R I N G
1938
[Preliminary figures]
Member banks
Nonmember banks
Other than mutual
savings and
private banks
Total
State
National
Insured
Mutual
savings
Private
_ Not
insured
ANALYSIS OF BANK CHANGES
Number of banks on December 31, 1937
Increases in number of banks:
Primary organizations (new banks) l
Reopenings of suspended banks
Decreases in number of banks:
Suspensions
Voluntary liquidations 2
Consolidations, absorptions, etc
Inter-class bank changes:
Conversions—
State into national
National into State
Federal Reserve memberships 3
Admissions of State banks
Withdrawals of State banks
Federal deposit insiirance 4
Admissions of State banks
Withdrawals of State banks
Net increase or decrease in number
of banks
Number of banks on December 31, 1938
15,387
5,260
+39
+2
+1
-55
-68
-105
7,449
""+r
+22
+1
+16
-46
-37
-58
-4
-23
-9
-i
-i
A
-26
+6
r
1,081
•
—6"
-5
-12
960
563
74
i
-2
-5
-2
2
-1
-1
+12
+49
-5
-47
+5
_2
+21
-5
-21
+5
-187
-36
+33
-133
-38
-8
-5
15,200
5,224
1,114
7,316
922
555
69
3,540
1,485
994
891
37
128
5
+52
+44
-1
+7
+17
+6
+34
+20
+3
+2
+1
+5
+1
-9
-19'
—24"
+10
-10
ANALYSIS OF BRANCH CHANGES
Number of branches on December 31, 1937
Increases in number of branches:
De novo branches
Banks converted into branches
Decreases in number of branches:
Suspension of parent bank
Voluntary liquidation of parent bank
Otherwise discontinued
Inter-class branch changes:
Branches of nonmember banks which became branches of State member banks 5 ..
Net increase or decrease in number
of branches
'
Number of branches on December 31, 1938
r
—1
-53
-1
+41
+14
o
+19
+4
+6
+1
3,581
1,499
991
910
41
134
6
Revised.
of new b a n k s organized to succeed operating b a n k s .
Exclusive of liquidations incident to t h e succession, conversion a n d absorption of b a n k s .
3
Exclusive of conversions of n a t i o n a l b a n k s i n t o S t a t e b a n k m e m b e r s , or vice versa, as such conversions
do n o t affect Federal Reserve m e m b e r s h i p .
4
Exclusive of conversions of m e m b e r b a n k s i n t o insured n o n m e m b e r b a n k s , or vice versa, as such conversions do n o t affect Federal Deposit I n s u r a n c e Corporation m e m b e r s h i p .
6
Includes 8 b r a n c h e s of insured n o n m e m b e r b a n k s which b e c a m e State m e m b e r b a n k s , a n d 2 b r a n c h e s of
a n insured n o n m e m b e r b a n k which was absorbed by a State m e m b e r b a n k .
1
Exclusive
2
68
ANNUAL REPORT OF BOARD OF GOVERNORS
No.
1 5 . — M O N E Y R A T E S , BOND Y I E L D S , AND STOCK P R I C E S 1
Open-market rates in
New York City2
(percent per annum)
Year and month
Prime
commercial
paper,
4-6
months
5 56
7.54
6 56
4.48
5.01
3 88
4 03
4.34
4 11
4.86
5.85
3 59
2 63
2.73
1.72
1 02
.76
.75
95
.81
1937
January
.
February
March
April
May
June
July
August
September
October
November
December
....
%
H
....
1.00
vA
1 00
. ..
1.00
1.00
1 00
1.00
1 00
1 00
1 00
Common stock prices4 (1926= 100)
Corporate
U.S.
Treasury
bills
U.S.
Treasury
notes
U. S.
Treasury
Total
Aaa
Baa
Industrial
Railroad
Public
utility
4-6
2-6
30
30
420
348
32
40
1 40
0.88
0.52
0 26
0.14
0.14
0 45
0.05
2*66
2 12
1.29
1.11
1 40
0.83
4 73
5.32
5.09
4.30
4.36
4.06
3.86
3.68
3 34
3.33
3.60
3 29
3 34
3.68
3.31
3 12
2.79
2.65
2 68
2.56
5 49
6.12
5.97
5.10
5.12
5.00
4 88
4.73
4 57
4.55
4.73
4 55
4 58
5.01
4.49
4.00
3.60
3.24
3 26
3.19
7 25
8.20
8.35
7.08
7.24
6.83
6 27
5.87
5 48
5.48
5.90
5.90
7.62
9.30
7.76
6 32
5.75
4.77
5 03
5.80
70 7
64.2
55.2
67.7
69.0
72.8
89 7
100.0
118 3
149.9
190.3
149 8
94.7
48.6
63.0
72 4
78.3
111.0
r
111.8
83.3
72 6
66.1
51.6
64.7
66.6
69.6
88 4
100.0
118 5
154 3
189.4
140 6
87 4
46.5
65.7
81 1
90.8
127.3
131 3
99.4
70 1
63.9
61.8
72.7
71.9
76.7
89 5
100.0
119 1
128.5
147.3
124 9
72 5
26.4
37.7
41 5
34.0
51.2
«• 49 3
26.1
60 3
54.5
57.8
70.9
73.8
78.9
94 9
100.0
116 0
148 9
234.6
214 6
148 7
79.1
78.1
68 9
71.4
104.3
' 94 8
73.2
0 36
0.38
0 58
0.70
0 65
0.56
0.49
0 52
0.53
0 34
0.15
0 10
1.18
1.22
1 44
1.59
1.48
1.54
1.44
1 45
1.50
1 42
1.31
1 27
2 47
2.46
2 60
2.80
2 76
2.76
2 72
2 72
2.77
2 76
2.71
2 67
3.10
3.22
3.32
3.42
3.33
3.28
3.25
3.24
3.28
3 27
3.24
3.21
4.49
4.53
4.68
4.84
4 84
4.93
4.91
4 92
5.16
5.52
5.82
5.73
126.0
129.5
129.9
124.5
116 3
113.6
117.8
120 5
106.4
91.4
82.9
82.2
146.3
151.7
152 6
146.5
136 7
134.0
130.4
143 5
126.2
107 4
96.1
95.2
55.6
57.9
62.8
60.1
57.1
53.9
52.1
50.9
42.6
35.4
31.4
31.2
113.2
110.7
105.7
100.7
94.1
91.3
95.9
97.0
89.2
81 3
79.5
78 8
0 10
0 08
0 07
0.08
0 03
0 02
0.05
0 05
0 10
0.02
0.02
0.01
1.13
1 09
1.01
0.94
0 77
0.67
0.70
0 71
0 82
0.68
0.71
0.67
2.65
2 64
2.64
2.62
2 51
2.52
2.52
2 51
2 58
2.48
2.50
2.49
3.17
3.20
3.22
3.30
3.22
3.26
3.22
3.18
3.21
3.15
3.10
3.08
5.89
5.97
6.30
6.47
6.06
6.25
5.63
5.49
5.65
5.36
5.23
5.27
81.6
80.7
77.9
70.7
73.9
73.1
88.0
89.5
86.0
91.1
94.7
92.0
95.7
95.7
92.7
84.2
87.4
86.4
105.3
108.0
103.9
109.6
113.6
110.6
29.0
28.3
25.5
20.9
21.8
20.5
27.3
27.8
25.5
28.1
30.0
28.8
75.7
71.2
68.5
64.0
69.5
69.2
76.5
75.0
72.2
77.4
80.9
77.9
Number of issues
1919
1920
1921
1922
1923
1924
1925
1926
1927
1928
1929
1930
1931 .
1932
1933
1934
1935
1936....
1937
1938
Bond yields3
(percent per annum)
1938
January .
February
March
April
Mav
June ..
July
August
September
October
November
December
.
....
...
1 00
1 00
%-l
%-\
%-\
M
%
H-H
Vs-SA
'Revised
Annual data are averages of monthly figures.
For commercial paper, monthly data are prevailing rates; for Treasury bills, the average rates on new issues
within period; and for Treasury notes the averages of daily figures for 3- to 5-year issues. Treasury bill series
comprises 90-day bills to February 16, 1934; 182-day bills from February 23, 1934 to February 23, 1935; 273-day
bills fromMarch 1, 1935 to October 15, 1937; bills maturing about March 16, 1938, from October 22 to December
10, 1937; and 91-day bills thereafter.
3
Monthly data are averages of daily figures. U . S . Treasury bond yields are averages of all outstanding bonds
due or callable after 12 years. Corporate average yields are as published b y Moody's Investors Service; until
1928 each rating group included 15 bonds; since the early p a r t of 1934 there have been less t h a n 30 bonds in t h e
Aaa group owing to the limited number of suitable issues in the industrial and railroad groups.
4
Standard Statistics Co. Monthly data are averages of Wednesday figures.
1
2
69
FEDERAL RESERVE SYSTEM
No. 16.—BUSINESS INDEXES *
[Adjusted for seasonal variation, 1923-1925 average—100]
Industrial production
Year and month
DeFac- Fac- Freight parttory tory
car
ment
emstore
Dur- Nonploy- rolls* loadings sales
able durMinResiAll
ment
able
(value)
Total man- man- erals Total dential other
ufac- ufactures tures
77
89
70
74
105
96
99
108
107
106
115
99
84
71
82
86
91
105
115
P86
83
86
92
83
53
79
80
93
102 100
92
96
106 104
110 106
101 110
112 112
122 117
89 101
59
99
33
88
50
98
57
97
76 102
99 110
107 110
P65 P100
114
116
118
118
118
114
114
117
111
102
88
84
112
113
113
117
120
112
122
126
114
101
74
60
83
87
67
85
101
95
104
108
106
111
119
96
81
64
76
79
90
105
110
1919
1920
1921
1922
1923
1924
1925
1926
1927
1928
1929
1930
1931
1932
1933
1934
1935
1936
1937
1938
Construction contracts awarded
(value)2
63
63
56
79
84
94
122
129
129
135
117
92
63
28
25
32
37
55
59
P64
44
30
44
68
81
95
124
121
117
126
87
50
37
13
11
12
21
37
41
79
90
65
88
86
94
120
135
139
142
142
125
84
40
37
48
50
70
74
107
107
82
91
104
96
100
102
100
100
106
92
78
66
73
86
91
98
106
98
117
76
81
103
96
101
104
102
104
110
89
68
47
50
65
74
86
102
P45
P80
P87
P78
111
116
128
115
117
115
112
113
116
113
109
115
63
62
56
53
56
61
67
62
56
52
56
61
45
47
45
44
44
42
44
40
37
36
32
30
77
75
64
61
66
77
86
81
71
65
76
87
105
106
107
108
109
108
109
109
107
105
101
95
56
93 108
54
94 103
54
93 103
53
91 101
51
93
91
50
95
92
58 102
93
64 108
95
69 107
97
84 106
99
95 110 102
P92 P 1 1 3 PI 08
52
51
46
52
51
54
59
66
78
82
96
26
32
33
37
37
42
49
53
56
57
56
73
66
56
65
62
64
68
77
96
102
128
90
89
87
85
84
82
83
85
87
88
90
P98
Wholesale
commodity
prices*
(1926=
100)
National
income
payments
(1929=
100)
84
91
78
85
100
"98
103
107
104
104
107
92
74
55
58
62
64
75
78
62
88
98
99
103
106
107
108
111
102
92
69
67
75
79
88
92
85
139
154
98
97
101
98
104
100
95
97
95
86
73
65
66
75
80
81
86
79
94
100
106
109
110
107
105
108
104
105
93
84
80
82
83
84
80
78
80
79
78
76
71
67
93
95
93
93
93
93
92
93
94
93
91
89
86
86
88
88
87
87
88
88
87
85
83
82
85
86
88
88
88
89
89
90
89
88
87
86
75
77
77
75
73
71
71
77
81
84
84
65
62
60
57
58
58
61
62
64
68
69
69
90
88
86
83
78
82
83
83
86
84
89
89
81
80
80
79
78
78
79
78
78
78
78
77
84
83
83
81
80
81
81
82
82
82
84
P85
78
94
87 I
100
93
80
63
58
66
71
82
88
P82
1937
January
February
March
April
May
June
July
August
September
October
November
December
117
119
120
119
116
115
108
110
107
100
94
95
1938
January
February
March
April
May
June
July
August
September
October
November
December
80
79
79
77
76
77
83
88
91
96
103
P104
P98
P57
P132
P91
P87
*Without seasonal adjustment.
P Preliminary.
1
Indexes compiled by the Board of Governors of the Federal Reserve System, except for indexes of wholesale
commodity prices and factory payrolls, compiled by the United States Bureau of Labor Statistics, and the
index of income payments, compiled by the United States Department of Commerce. Descriptions and back
figures
for the Board's indexes may be obtained from the Division of Research and Statistics.
2
Three-month moving average, centered at second month, based on F. W. Dodge Corporation data for 37
Eastern States.
APPENDIX
71
RECORD OF POLICY ACTIONS—BOARD OF GOVERNORS
MEETING ON MARCH 17, 1938
Members present: Mr. Ransom, Vice Chairman; Mr. Szymczak, Mr.
Davis.
Amendment No. 1 of Revised Regulation T, Extension and Maintenance of
Credit by Brokers, Dealers, and Members of National Securities Exchanges.
By unanimous vote, Regulation T was amended effective
March 21, 1938, (1) to allow a broker under Section 4(b)
to permit withdrawals from omnibus accounts even though,
as a result of the transactions in the account on the da}r of
the withdrawal, additional margin is required in the account; (2) to extend the seven-day period provided in section 4(c) relating to special cash accounts, by the number
of days required for shipments of securities but not more
than an additional seven days; and (3) to permit a creditor
under section 4(f) to finance for an odd-lot dealer, without
being subjected to the standard margin requirements, the
transactions of such a person in his capacity as an odd-lot
dealer.
The Board was of the opinion that, in order to meet certain operating
difficulties which were being experienced by some of those subject to the
regulation, the regulation could be liberalized in these respects without
affecting adversely the purposes for which it was adopted.
MEETING ON APRIL 15, 1938
Members present: Mr. Eccles, Chairman; Mr. Ransom, Vice Chairman; Mr. Szymczak, Mr. McKee, Mr. Davis, Mr. Draper.
Reduction in Reserve Requirements of Member Banks.
It was voted unanimously at this meeting, for the purpose of reducing reserve requirements of member banks, to
adopt, effective at the opening of business on April 16, 1938,
a revised supplement to Regulation D, Reserves of Member
Banks, requiring that each member bank maintain on deposit with the Federal Reserve bank of its district reserve
balances equal to 12 percent of its net demand deposits if
the bank be not located in a reserve or central reserve city,
YIV2 percent of its net demand deposits if the bank be
located in a reserve city, and 22% percent of its net demand
deposits if the bank be located in a central reserve city,
plus 5 percent of its time deposits.
It was estimated that as a result of this reduction in reserve requirements excess reserves of member banks would increase by about $750,000,000. This action had been agreed upon by the members of the
Board as a part of the program announced by the President of the
73
74
ANNUAL REPORT OF BOARD OF GOVERNORS
United States on April 14, 1938, for the encouragement of business
recovery. Although there had been excess reserves in amounts considered ample to meet all probable needs of agriculture, commerce and
business, the volume of business activity had declined with such rapidity
as to produce injurious deflationary effects upon commodity prices, the
capital market, and industry generally. In these circumstances and in
view of the other steps proposed to be taken in the Government's program for encouraging business recovery, the Board decided that a reduction in reserve requirements of member banks might be helpful, as a
part of a concerted effort by the Government to carry out the purposes
of this program, by assuring the continued availability of ample funds
for meeting business requirements and thereby preventing injurious
credit contraction.
MEETING ON AUGUST 31, 1938
Members present: Mr. Ransom, Vice Chairman; Mr. Szymczak, Mr.
McKee, Mr. Davis, Mr. Draper.
Amendment to Regulation L, Interlocking Bank Directorates under the Clayton Act, to Discontinue Permission Granted to a Private Banker or a
Director, Officer or Employee of a Member Bank to Serve a Morris Plan
Bank or Similar Institution.
By unanimous vote, subsection 3 (a) of Regulation L,
Interlocking Bank Directorates Under the Clayton Act, was
amended, effective February 1, 1939, to discontinue the permission granted by that subsection to a private banker or a
director, officer or employee of a member bank to serve a
Morris Plan bank or similar institution.
When the regulation containing the permission above referred to was
adopted in January 1936 it appeared that Morris Plan banks were not
generally engaged in the same classes of business as commercial banks.
Since that time, however, there has been an increasing tendency on the
part of commercial banks to enter the personal loan field and on the
part of Morris Plan banks to accept deposits subject to check as well as
time and savings deposits and to make commercial loans. In the opinion of the Board the development of this tendency has made undesirable
the creation of additional interlocking directorates of this type or the
continuation of those in existence, in view of the general purpose of the
prohibition against interlocking directorates contained in section 8 of
the Clayton Act as amended by the Banking Act of 1935. The Board
decided to make this action effective February 1, 1939, because of the
fact that the statute makes unlawful the continuance after that date of
certain other existing interlocking relationships.
MEETING ON NOVEMBER 7, 1938
Members present: Mr. Eccles, Chairman; Mr. Ransom, Vice Chairman; Mr. Szymczak, Mr. McKee, Mr. Davis, Mr. Draper.
Amendments to Regulation L, Interlocking Bank Directorates under the
Clayton Act.
By unanimous vote:
(1) Subsection 3 (a) of Regulation L, Interlocking Bank
Directorates Under the Clayton Act, was amended, effective immediately, to permit any private banker or any di
FEDERAL RESERVE SYSTEM
75
rector, officer, or employee of a member bank of the Federal
Reserve System who is lawfully serving as a director, officer,
or employee of a Morris Plan bank or similar institution on
January 31, 1939, to continue such service until August 1,
1939.
(2) A new subsection (e) was added at the end of Section 3 of Regulation L to provide that any director, officer,
or employee of any member bank of the Federal Reserve
System who, on August 23, 1935 (date of approval of the
Banking Act of 1935), was lawfully serving at the same
time as a private banker or as a director, officer, or employee of any other bank, banking association, savings
bank, or trust company and whose services in such capacities had been continuous since such date, may continue,
until August 1, 1939, to serve such member bank and not
more than one other such bank, banking association, savings bank, trust company or private banker.
The reasons for the Board's action were set forth in the following
statement:
The Board believes that the principles of Section 8 of the Clayton
Act, which relate to interlocking bank directorates, are in the public
interest and should be applied to all classes of banks. The law is
now discriminatory in that it applies only to cases involving member banks of the Federal Reserve System or private banks. The
Board does not believe that there should be discrimination in any
respect among classes of banks subject to Federal authority.
In view of the fact that less than a month will elapse between
the convening of the new Congress and February 1, 1939, on which
date certain existing relationships would terminate, the Board has
exercised its discretion under the law, as to such relationships involving not more than two banks, to extend this time to August 1, 1939.
This action was taken for the purpose of calling the matter to the
attention of Congress when it convenes, with a recommendation
that the existing discrimination between member banks and nonmember banking institutions be removed so that the provisions of
the law will apply alike to all banks under Federal authority.
RECORD OF POLICY ACTIONS—FEDERAL OPEN MARKET
COMMITTEE
MEETING ON MARCH 1, 1938
Members present: Mr. Eccles, Chairman; Mr. Harrison, Vice Chairman; Mr. Szymczak, Mr. McKee, Mr. Ransom, Mr. Davis, Mr. Sinclair,
Mr. Newton, Mr. Schaller, Mr. Peyton.
Authority (1) to Replace Maturing Securities and to Make Shifts of Securities
in the System Open Market Account and (2) to Increase or Decrease System Open Market Account.
By unanimous vote, the Committee instructed the executive committee, until otherwise instructed by the Federal
Open Market Committee, to direct the replacement of maturing securities in the system open market account with
other Government securities and to make such shifts between maturities in the account as may be necessary in the
proper administration of the account, provided that the
amount of securities maturing within two years be main-,
tained at not less than $1,000,000,000 and that the amount
of bonds having maturities in excess of five years be not
over $850,000,000 nor less than $500,000,000.
The Committee also voted unanimously to authorize the
executive committee upon written, telephonic, or telegraphic
approval of a majority of the members of the Federal Open
Market Committee, and until otherwise directed by the
Committee, to direct the purchase in the open market from
time to time of sufficient amounts of Government securities
to meet the requirements of commerce, business, and agriculture by keeping at member banks an aggregate volume
of excess reserves adequate for the continuance of the System's policy of maintaining credit conditions conducive to
economic recovery; and to authorize the executive committee, upon written, telephonic, or telegraphic approval of a
majority of the members of the Committee, and until otherwise directed by the Committee, to direct a reduction of the
holdings of such securities, to the extent that their retention- was found to be unnecessary for the purpose of this
action. It was understood, however, that the executive
committee was not authorized to increase or decrease by
more than $300,000,000 the amount of securities held in
the system open market account.
In the opinion of the Committee the existing amount of excess reserves
of member banks was not too large in view of the low volume of business activity, declining prices, and business uncertainty and, therefore,
no useful purpose would be achieved at this time by reducing the amount
of the securities held by the System. It was agreed, however, that provision should be made for prompt action in purchasing securities, when
approved by a majority of the Committee for the purpose of keeping at
member banks an aggregate volume of excess reserves adequate for the
continuance of the system's policy of maintaining credit conditions conducive to economic recovery, and that similar provision should be made
76
FEDERAL RESERVE SYSTEM
77
for the sale of securities to the extent that their retention would be unnecessary for this purpose. It was agreed also that the existing authority
of the executive committee to replace maturing securities and to make
shifts of securities in the account should be continued in order to enable
the executive committee to meet changing market conditions and to improve the distribution of maturities in the account.
MEETING ON APRIL 22, 1938
Members present: Mr. Eccles, Chairman; Mr. Harrison, Vice Chairman; Mr. Szymczak, Mr. McKee, Mr. Ransom, Mr. Davis, Mr. Draper,
Mr. Sinclair, Mr. Newton, Mr. Schaller, Mr. Peyton.
Authority to Replace Maturing Securities and to Make Shifts of Securities in
the System Open Market Account.
The following resolution was presented by Mr. Harrison,
who moved its adoption:
a
In view of the fact that the present and prospective amounts of
excess reserves of member banks are tending to make it more difficult for the System, by means of shifts in the maturities in the open
market account, to exercise its influence towards orderliness in the
Government securities market
VOTED that, until otherwise authorized or directed by the
Committee, and in addition to the authority to make shifts
in the maturities in the system open market account, the
executive committee be authorized to permit fluctuations
in the total amount of the account in order more effectively,
with the means available and in the light of current conditions, to exert its influence towards orderly conditions in the
Government bond market, provided, however, that the account shall not be increased or decreased by more than
$200,000,000 from the present level of the account,"
The presentation of the foregoing resolution followed a detailed discussion of developments in connection with the recently announced
Government program for the encouragement of business recovery, including the release of gold held in the inactive gold account of the Treasury,
the reduction made by the Board of Governors of the Federal Reserve
System as of April 16, 1938, in reserve requirements of member banks,
and a reduction in the amounts of current weekly offerings by the Treasury of Treasury bills for sale in the market. Mr. Harrison presented
his resolution on the ground that in all the circumstances the executive
committee should have authority to permit some flexibility in the system
open market account by allowing some reduction in the amount of the
account if that should seem desirable as a factor in restraining a disorderly rise in the market just as in the past, by purchases of securities,
it had exerted its influence toward maintaining an orderly market on a
decline. In his opinion, some reasonable reduction in the account at
such a time should not be interpreted as a reversal of the policy of the
Government with respect to excess reserves and probably would serve
to make the market less vulnerable in the future.
As a substitute for Mr. Harrison's resolution, a motion was made and carried unanimously that the executive committee be instructed to direct the replacement of
78
ANNUAL REPORT OF BOARD OF GOVERNORS
the next maturing Treasury bills in the system open
market account with Treasury bills or notes having maturities not to exceed two years, provided that such securities could be purchased without paying a premium above
a no-yield basis, with the understanding that another meeting of the Federal Open Market Committee would be held
next week.
Thereupon, by unanimous vote, the Committee instructed
the executive committee, until otherwise instructed by the
Committee and subject to the limitations contained in the
motion previously adopted on this date with respect to the
next maturing Treasury bills in the account, to direct the
replacement of maturing securities in the system open
market account with other Government securities and to
make such shifts between maturities in the account as may
be necessary in the proper administration of the account,
provided that the amount of securities maturing within
two years be maintained at not less than $1,000,000,000
and that the amount of bonds having maturities in excess of
five years be not over $850,000,000 nor less than $500,000,000.
The foregoing actions were taken by the Committee on the ground
that the question of general policy to be followed by the Committee
required further study in the light of actual developments during an
interval before another meeting of the Committee, which it was agreed
should be held the following week and, therefore, that during such
interval there should be no change in the size of the system account
except to the extent that it might prove to be impossible to replace
maturing securities without paying a premium over a no-yield basis
for replacement securities maturing within two years.
MEETING
ON APRIL 29, 1938
Members present: Mr. Eccles, Chairman; Mr. Harrison, Vice Chairman; Mr. Szymczak, Mr. McKee, Mr. Ransom, Mr. Davis, Mr. Draper,
Mr. Sinclair, Mr. Newton, Mr. Peyton, Mr. Martin (alternate for- Mr.
Schaller).
Authority (1) to Replace Maturing Securities and to Make Shifts of Securities
in the System Open Market Account and (2) to Increase or Decrease the
System Open Market Account.
It was moved that the following resolutions be adopted:"That the executive committee be directed, until otherwise directed by the Federal Open Market Committee, to arrange for the
replacement of maturing securities in the system open market account with other Government securities and for such shifts in maturities as may be necessary in the proper administration of the
account, provided (1) that maturing Treasury bills shall be replaced only with Treasury bills or notes maturing within two
years to the extent that they can be purchased without paying a
premium over a no-yield basis; (2) that, subject to the foregoing
limitation, the amount of securities in the account maturing within
two years be maintained at not less than $1,000,000,000; and (3)
that the amount of bonds in the account having maturities in
FEDERAL RESERVE SYSTEM
79
excess of five years be maintained at not less than $500,000,000
nor more than $850,000,000.
"That, in addition to such authority as may be contained in
other resolutions of the Federal Open Market Committee and until
otherwise directed by the Committee, the executive committee be
authorized, upon written, telephonic or telegraphic approval of a
majority of the members of the Federal Open Market Committee,
to arrange for the purchase or sale (which would include authority
to allow maturities to run off without replacement) of Government
securities in the open market from time to time for the system
open market account to such extent as the executive committee
shall find to be necessary for the purpose of exercising an influence
toward maintaining orderly market conditions, provided (1) that
the total amount of securities in the account be not increased or
decreased by more than $125,000,000, and (2) that the amount
of bonds in the account having maturities over five years be maintained at not less than $500,000,000 nor more than $850,000,000."
Mr. Harrison moved as a substitute for the above motion
that the following resolution be adopted:
'That until otherwise authorized or directed by the Federal
Open Market Committee the executive committee be authorized
(a) to make such shifts in maturities in the system open market
account as may be necessary in the proper administration of the
account, and (b) to permit fluctuations in the total amount of the
account in order more effectively with the means available and
in the light of current conditions to exert its influence toward maintaining orderly conditions in the market, provided (1) that the
amount of securities in the account maturing within two years be
maintained at not less than $1,000,000,000, (2) that the amount of
bonds in the account having maturities in excess of five years be
maintained at not less that $500,000,000 nor more than $850,000,000,
and (3) that the total amount of the account be not increased or
decreased by more than $200,000,000 from the present level of the
account."
The substitute motion was put by the Chair and lost,
the members voting as follows: "aye," Messrs. Harrison,
McKee and Sinclair; "no," Messrs. Eccles, Szymczak, Ransom, Davis, Draper, Newton, Peyton and Martin.
The original motion was put by the Chair and carried
unanimously.
Mr. Harrison's substitute resolution was offered on the ground that
it might become increasingly difficult for the system to exercise an influence toward orderly conditions in the market by means of shifts
in maturities in the account; that further replacement of maturing
securities with short maturities might accentuate the existing abnormalities in short and long term rates; than an effort to exert an influence
toward orderly market conditions at this time was important if we were
to avoid a too rapid or extensive rise in bond prices which might make
the market vulnerable to later reactions; that a reduction in the account at this time, especially if it resulted merely from a failure to
replace
maturities and if effected for the purpose of exercising the
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ANNUAL REPORT OF BOARD OF GOVERNORS
system's influence toward the maintenance of orderly market conditions,
should not be interpreted as in conflict with or as counteracting the
Government's recent program to increase excess reserves; and that in
order to meet its responsibility more effectively under prevailing conditions the executive committee should have authority to sell securities
or allow maturities to run off without replacement.
The majority voted against the substitute motion on the ground
that a reduction in the system account would effect a corresponding
reduction of excess reserves of member banks from the amount that
would exist otherwise; that such action at this time would be regarded
as inconsistent with the Government's announced program and particularly with the action of the Board of Governors in reducing reserve
requirements; and that such action should not be taken unless there
were developments subsequent to this meeting which would require a
reconsideration of the general policy, in which event another meeting
of the Committee should be called.
The unanimous action of the full Committee on the original motion was taken in the light of the position of the majority on the
substitute resolution, it being agreed that in these circumstances the
executive committee should have the usual authority to replace maturing securities and to make shifts of securities in the account subject to
the limitation that maturing Treasury bills should be replaced only
with Treasury bills or notes maturing within two years to the extent
that they could be purchased without paying a premium over a no-yield
basis; and that in order to meet unforseen conditions that might arise
in the interval before another meeting of the full Committee could be
convened, the executive committee should be in position to act promptly
with approval of a majority of the full Committee to increase or decrease the system account as circumstances might warrant.
MEETING ON AUGUST 2. 1938
Members present: Mr. Eccles, Chairman; Mr. Harrison, Vice Chairman; Mr. Szymczak, Mr. McKee, Mr. Ransom. Mr. Davis, Mr. Draper,
Mr. Sinclair, Mr. Schaller, Mr. Newton, Mr. Peyton.
Authority (1) to Replace Maturing Securities and to Make Shifts of Securities
in the System Open Market Account and (2) to Increase or Decrease the
System Open Market Account.
Upon motion duly made and seconded, and by unanimous
vote, the following resolutions were adopted:
"That the executive committee be directed, until otherwise directed by the Federal Open Market Committee, to arrange for the
replacement of maturing securities in the system open market account with other Government securities and for such shifts in
maturities as may be necessary in the proper administration of the
account, provided (1) that maturing Treasury bills shall be replaced only with Treasury bills or notes to the extent that they
can be purchased without paying a premium over a no-yield basis;
(2) that, subject to the foregoing limitation, the amount of securities
in the account maturing within two years be maintained at not less
than $1,000,000,000; and (3) that the amount of bonds in the account having maturities in excess of five years be maintained at not
less than $500,000,000 nor more than $850,000,000.
FEDERAL RESERVE SYSTEM
81
"That, in addition to such authority as may be contained in other
resolutions of the Federal Open Market Committee and until otherwise directed by the Committee, the executive committee be authorized, upon written, telephonic or telegraphic approval of a majority
of the members of the Federal Open Market Committee, to arrange
for the purchase or sale (which would include authority to allow
maturities to run off without replacement) of Government securities
in the open market from time to time for the system open market
account to such extent as the executive committee shall find to
be necessary for the purpose of exercising an influence toward maintaining orderly market conditions, provided (1) that the total
amount of securities in the account be not increased or decreased by
more than $125,000,000, and (2) that the amount of bonds in the
account having maturities over five years be maintained at not less
than $500,000,000 nor more than $850,000,000."
The members of the Committee agreed that the resolutions containing
instructions to the executive committee which were adopted at the
previous meeting of the full Committee should be renewed and for the
same reasons, but that the new resolutions should contain a modification
with respect to the replacement of maturing Treasury bills. In June,
1938, considerable difficulty was experienced in replacing maturing bills
with Treasury obligations maturing within two years (as required by
the authority granted at the meeting of the Federal Open Market Committee on April 29) without paying a premium over a no-yield basis for
the new securities and it appeared that further replacements with
Treasury bills and notes within the two-year limitation would be extremely difficult if not impossible without paying such a premium for the
replacement securities. In these circumstances the members of the
Federal Open Market Committee (except Mr. Davis who was absent),
on July 1, 1938, agreed to waive, until otherwise directed by the Committee, the requirement contained in the first resolution adopted at the
meeting of the Committee on April 29 that Government securities purchased in replacement of maturing Treasury bills have maturities within
two years and this action was ratified by unanimous vote at the meeting
of the Committee on August 2. As it was thought that there might be
a continuation of the difficulties in obtaining replacement securities with
maturities up to two years without paying a premium over a no-yield
basis the Committee decided that the resolution adopted at this meeting authorizing replacement of maturing securities should provide that
maturing bills be replaced with bills and notes without limitation as to
maturity, but only to the extent that they could be obtained without
paying a premium over a no-yield basis.
MEETING ON SEPTEMBER 21, 1938
Members present: Mr. Harrison, Vice Chairman; Mr. Szymczak, Mr.
McKee, Mr. Ransom, Mr. Davis, Mr. Sinclair, Mr. Newton, Mr. Schaller,
Mr. Peyton.
Authority (1) to Replace Maturing Securities and to Make Shifts of Securities
in the System Open Market Account and (2) to Increase or Decrease the
System Open Market Account.
Upon motion duly made and seconded, the following
resolutions were adopted by unanimous vote:
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ANNUAL REPORT OF BOARD OF GOVERNORS
'That the executive committee be directed, until otherwise directed by the Federal Open Market Committee, to arrange for the
replacement of maturing securities in the system open market account with other Government securities and for such shifts in maturities as may be necessary in the proper administration of the account,
provided (1) that maturing Treasury bills shall be replaced only with
Treasury bills or notes to the extent that they can be purchased
without paying a premium over a no-yield basis; (2) that, subject
to the foregoing limitation, the amount of securities in the account
maturing within two years be maintained at not less than $1,000,000,000; and (3) that the amount of bonds in the account having
maturities in excess of five years be maintained at not less than
$500,000,000 nor more than $900,000,000.
"That, in addition to such authority as may be contained in other
resolutions of the Federal Open Market Committee and until otherwise directed by the Committee, the executive committee be authorized, upon written, telephonic or telegraphic approval of a
majority of the members of the Federal Open Market Committee,
to arrange for the purchase or sale (which would include authority
to allow maturities to run off without replacement) of Government
securities in the open market from time to time for the system open
market account to such extent as the executive committee shall
find to be necessary for the purpose of exercising an influence toward
maintaining orderly market conditions, provided (1) that the total
amount of securities in the account be not increased or decreased
by more than $200,000,000, and (2) that the amount of bonds in
the account having maturities over five years be maintained at not
less than $500,000,000 nor more than $900,000,000."
The resolutions were adopted for the reasons which prompted the
Committee in adopting the resolutions containing the existing instructions
to the executive committee. However, it was felt that the authority
granted to the executive committee to increase or decrease the system
account upon written, telephonic or telegraphic approval of a majority
of the members of the full Committee should be enlarged for the reason
that, while it appeared that the immediate possibility of war in Europe
had diminished, there was considerable uncertainty in the situation which
might result in the necessity for emergency action before another meeting
of the full Committee could be held. In view of these circumstances, the
limit placed in the second resolution upon such action was increased to
$200,000,000. For the same reason the maximum limit on the amount of
bonds in the account having maturities over five years was increased to
$900,000,000 in both the first and second resolutions.
MEETING ON DECEMBER 30, 1938
Members present: Mr. Eccles, Chairman; Mr. Harrison, Vice Chairman; Mr. Szymczak, Mr. McKee, Mr. Ransom, Mr. Davis, Mr. Draper,
Mr. Sinclair, Mr. Schaller, Mr. Peyton, Mr. Leach (alternate for Mr.
Newton).
Authority (1) to Replace Maturing Securities and to Make Shifts of Securities
in the System Open Market Account and (2) to Increase or Decrease System Open Market Account.
Upon motion duly made and seconded, the following resolutions were adopted, Messrs. Harrison, Szymczak, McKee,
FEDERAL RESERVE SYSTEM
83
Davis, Sinclair, Schaller, Peyton and Leach voting "aye"
and Messrs. Eccles, Ransom and Draper voting "no."
"That the executive committee be directed until otherwise directed
by the Federal Open Market Committee, (1) to arrange for the
replacement of maturing Treasury bills in the system open market
account with other Treasury bills or Treasury notes, or, from time
to time, to allow such bills to mature without replacement or pending subsequent replacement (a) when market conditions are such
as to make it impossible to procure other bills or notes without paying a premium over a no-yield basis, or (b) when such notes are
not obtainable without undue disturbance to the market; (2) to
arrange for the replacement of maturing Treasury notes and bonds
in the system open market account with other Government securities;
and (3) to arrange for such shifts in maturities in the system open
market account as may be necessary in the proper administration
of the account; provided, (a) that the amount of securities in the
account maturing within two years be maintained at not less than
$1,000,000,000; (b) that the amount of bonds in the account having
maturities in excess of five years be maintained at not less than
$500,000,000 nor more than $900,000,000; and (c) that, if Treasury
bills in the account are allowed to mature without replacement, the
total amount of securities in the account be not decreased by more
than $200,000,000.
"That, in addition to such authority as may be contained in other
resolutions of the Federal Open Market Committee and until otherwise directed by the Committee, the executive committee be authorized, upon written, telephonic or telegraphic approval of a majority
of the members of the Federal Open Market Committee, to arrange
for the purchase or sale (which would include authority to allow
maturities to run off without replacement) of Government securities
in the open market from time to time for system open market
account to such extent as the executive committee shall find to be
necessary for the purpose of exercising an influence toward maintaining orderly market conditions, provided (1) that the total
amount of securities in the account be not increased by more than
$200,000,000 nor decreased by more than $200,000,000 including
such decreases as may result from allowing Treasury bills in the
account to mature without replacement, and (2) that the amount of
bonds in the account having maturities over five years be maintained at not less than $500,000,000 nor more than $900,000,000."
This action was taken in continuation of the existing policy of the
Committee, the reasons for which have been stated in connection with
resolutions adopted at previous meetings. In adopting this resolution,
however, certain changes were made in the provisions bearing upon the
replacement of maturing Treasury bills held in the System account,
for reasons which are set forth in the following press statement, which
was approved by the Committee following the adoption of the resolution:
"The Federal Open Market Committee announced, following a
meeting today, that weekly statements of the total holdings in
the Federal Reserve System's Open Market .Account may at times
show some fluctuation depending upon conditions in the market
affecting the Committee's ability to replace maturing Treasury bills
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ANNUAL REPORT OF BOARD OF GOVERNORS
held in its portfolio. The volume of Treasury bills available on the
market has declined materially during the year and, owing to the
large and increasing demand, such bills are already selling either
on a no-yield basis or at a premium above a no-yield basis. It has,
therefore, become difficult and in some weeks impossible for the
System to find sufficient bills on the market to replace those that
mature. Short-term notes are also selling on a no-yield basis and
longer-term notes have at times been difficult to obtain. In these
circumstances, it may be necessary from time to time to permit
bills held in the portfolio to mature without replacement, not because of any change in Federal Reserve policy but solely because
of the technical situation in the market. Because no change in
Federal Reserve policy is contemplated at this time, maturing bills
will be replaced to the extent that market conditions warrant."
On this statement Mr. Ransom requested that he be
recorded as not voting, in view of his vote against the resolution in the form in which it was adopted by the Committee.
It having been necessary for Mr. Draper to leave the meeting before the action was taken, he advised the Committee's
Secretary later that he desired to be recorded as approving
the press statement in view of the action of the Committee
on the resolution. All the other members of the Committee
voted in favor of the statement.
RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL
TO THE BOARD OF GOVERNORS OF THE FEDERAL
RESERVE SYSTEM
MAY 17, 1938
Topic: Unification of Bank Examinations.
RECOMMENDATION: The Federal Advisory Council has given careful
consideration to the views of the Board of Governors of the Federal
Reserve System on the subject of the classification of loans in reports
of bank examiners and the treatment of investment portfolios in such
reports.
It is the sense of the Council that the general plan as to the classification of loans which is now followed should be continued; that the heading
"slow" should be altered, but that in Column 1 there should be brought
together loans not presently considered doubtful or losses, but of a type
which a bank would not and should not currently make, and that the
total of such loans should be brought together in the Recapitulation
Sheet. "Doubtful" and "Loss" columns should be continued as at
present.
The Council also believes that the entire investment portfolio of all
banks should be listed, priced, and totaled and that this information is
necessary if the directors of banks generally are to have an adequate
picture of the banks' condition. This is particularly true since at the
present time the investment portfolio of the average bank represents a
large percentage of its total assets.
The Council also feels that the difference between market value and
carrying value in the case of all defaulted bonds, stocks, and non-defaulted bonds of low grade should be set up as loss or doubtful. Unless
the market value of the total investment portfolio is in excess of carrying
value, the bank should be required either to set up adequate reserves to
cover depreciation on such items, or to charge it off.
The Council does not believe that market depreciation in securities of
high grade should be set up as "loss" or "doubtful" by the examiners.
It does believe, however, that where such market depreciation exists,
that unless the total market value of the investment portfolio is in excess
of its carrying value, the examiners should use their influence to have
the bank set up reserves sufficient to bring the carrying value of the
investment portfolio down to at least market value. The bank should
be given amply reasonable time to create such reserves.
The Council believes that the Comptroller's regulations regarding
marketability and character of investment securities which a bank can
purchase should be liberalized and that all reference to classification by
manuals should be omitted therefrom.
The Council would further favor an amendment of the law so as to
remove the requirement of marketability from investment securities
which a bank could purchase. The Council believes that the examiners
could and should see that banks in making investments do not acquire
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ANNUAL REPORT OF BOARD OF GOVERNORS
an undue percentage of non-marketable investments in relation to their
total assets and capital funds.
NOVEMBER 29, 1938
Topic: Assignment of Claims on the United States.
RECOMMENDATION : The Federal Advisory Council requests the Board
of Governors of the Federal Reserve System to recommend to the proper
authorities an amendment to that part of section 3477 of the Revised
Statutes of the United States which is Title 31 U.S.C.A., Sec. 203, which
makes null and void all transfers and assignments of any claims on the
United States. The amendment should permit the assignment of claims
where legitimate credit has been extended, excepting in those cases where
claims arise in consequence of torts, tax refunds, or the like.
COMPARISON OF SOME OF THE FEDERAL STATUTORY
PROVISIONS REGULATING THE BUSINESS
OF
DIFFERENT CLASSES OF BANKSl
I. Federal statutory provisions applicable to national banks ONLY.
Restrictions on real estate loans.
Regulations governing exercise of trust powers.
Restrictions on acting as insurance agent.
Restrictions on acting as real estate loan broker.
Requirement that one-tenth of earnings be transferred to
surplus until surplus equals common capital.
Prohibition against holding "other real estate" for more
than five years.
Limitations on total loans to one borrower.2
Restrictions on absorption of another bank.
Limitations on indebtedness which bank may incur.
II. Federal statutory provisions applicable to all member banks, but NOT to
nonmember insured banks (standards not necessarily uniform between
national banks and State member banks).
Regulations governing purchase of investment securities.
Prohibition against purchasing stocks and engaging in
underwriting of investment securities and stocks.
Restrictions on loans to executive officers.
Restrictions on dealings with directors.
Prohibition against paying preferential rate of interest on
deposits of directors, officers, etc.
Restrictions on interlocking directorates or other interlocking relations with other banks.
Restrictions on interlocking directorates or other interlocking relations with securities companies.
Prohibition against bank having less than 5 or more than
25 directors.
Provision authorizing supervisory authority to remove officers or directors for continued violations of law or continued unsafe or unsound practices.
Prohibition against affiliation with securities company.
Restrictions on holding company affiliates.
Restrictions of bank stock representing stock of other corporations.
Limitations on loans to affiliates.
Limitations on investment in bank premises.
Minimum capital requirements.
Minimum capital requirements for branches.
1
There are a few Federal banking laws which apply to all banks including noninsured banks. Among
them are provisions of law restricting the receipt of deposits by nonbanking institutions, including securities companies; those regulating loans for the purpose of purchasing or carrying securities registered on national securities exchanges; and those granting certain tax advantages in connection with the operation of
a common
trust fund if operated in conformity with the regulations of the Board of Governors.
2
Loans in excess of the limit fixed by the National Banking Act may not be discounted with a Federal Reserve bank by a State member bank but that part of a loan which is not excessive may be discounted by a
national bank.
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ANNUAL REPORT OF BOARD OF GOVERNORS
Prohibition against loaning on or purchasing own stock.
Restrictions on withdrawal of capital and payment of unearned dividends.
Requirement that reserves specified in Federal Reserve Act
be maintained.
Prohibition against making loans or paying dividends while
reserves deficient.
Requirements in connection with par clearance collection
system.
Prohibition against false certification of checks.
Limitations on acceptance powers.
Prohibition against acting as agent for nonbanking institutions in making loans to brokers or dealers in securities.
Limitations on loans to one borrower on stocks or bonds.
Limitations on aggregate loans to all borrowers on stocks
or bonds.
Limitations on deposits with nonmember banks.
III. Federal statutory provisions applicable to member banks and to nonmember insured banks (standards not necessarily uniform between
national banks, State member banks, and insured nonmember banks).
Restrictions on establishment of branches.
Restrictions on consolidating or merging with noninsured
bank, assuming liability for such bank's deposits, or
transferring assets to such bank for assumption of deposits.
Restrictions on payment of interest on deposits.
Restrictions on paying time deposits before maturity or
waiving notice before payment of savings deposits.
Prohibition against payment of dividends while delinquent
on deposit insurance assessment.
Prohibition against loans or gratuities to bank examiners.
Provision authorizing supervisory authority to publish examination report if bank does not follow recommendation
based thereon.
Provision authorizing supervisory authority to require that
bank provide protection and indemnity against burglary,
defalcation and similar insurable losses.
REVISION IN BANK EXAMINATION PROCEDURE
Following is description of the revision of procedure in bank examinations as agreed to by the Secretary of the Treasury, the Board of Governors of the Federal Reserve System, the directors of the Federal Deposit
Insurance Corporation, and the Comptroller of the Currency:
The Classification of Loans in Bank Examinations.—The present captions of the classification units, namely, "Slow," "Doubtful," and "Loss"
are to be abandoned.
The classification units hereafter will be designated numerically and
the following definitions thereof will be printed in examination reports:
I. Loans or portions thereof the repayment of which appears
assured. These loans are not classified in the examination report.
II. Loans or portions thereof which appear to involve a substantial and unreasonable degree of risk to the bank by reason of
an unfavorable record or other unsatisfactory characteristics noted
in the examiner's comments. There exists in such loans the possibility of future loss to the bank unless they receive the careful
and continued attention of the bank's management. No loan is so
classified if ultimate repayment seems reasonably assured in view
of the sound net worth of the maker or endorser, his earning capacity
and character, or the protection of collateral or other security of
sound intrinsic value.
III. Loans or portions thereof the ultimate collection of which is
doubtful and in which a substantial loss is probable but not yet
definitely ascertainable in amount. Loans so classified should receive the vigorous attention of the management with a view to
salvaging whatever value may remain.
IV. Loans or portions thereof regarded by the examiner for
reasons set forth in his comments as uncollectible and as estimated
losses. Amounts so classified should be promptly charged off.
Present practice will be continued under which the totals of II, III
and IV above are included in the recapitulation or summary of examiners' classifications.
Fifty percent of the total of III above and all of IV above will be
deducted in computing the net sound capital of the bank.
The Appraisal of Bonds in Bank Examinations.— Neither appreciation nor depreciation in Group I securities will be shown in the report.
Neither will be taken into account in figuring net sound capital of the
bank.
Group I securities are marketable obligations in which the investment characteristics are not distinctly or predominantly speculative. This group includes general market obligations in the four
highest grades and unrated securities of equivalent value.
The securities in Group II will be valued at the average market price
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ANNUAL REPORT OF BOARD OF GOVERNORS
for eighteen months just preceding examination and 50 percent of the net
depreciation will be deducted in computing the net sound capital.
Group II securities are those in which the investment characteristics are distinctly or predominantly speculative. This group includes general market obligations in grades below the four highest,
and unrated securities of equivalent value.
Present practice will be continued under which net depreciation in the
securities in Group III and Group IV is classified as loss.
Group III securities: Securities in default.
Group IV securities: Stocks.
Present practice will be continued under which premiums on securities
purchased at a premium must be amortized.
Present practice of listing all securities and showing their book value
will be continued.
The Treatment of Securities Profits in Bank Examinations.—Until
losses have been written off and adequate reserves established, the use
of profits from the sale of securities for any purpose other than those,
will not be approved.
Present practice will be continued under which estimated losses must
be charged off.
Present practice will be continued under which the establishment and
maintenance of adequate reserves, including reserves against the securities account, are encouraged.
Present practice will be continued under which speculation in securities is criticised and penalized.
REVISED REGULATION ISSUED BY THE COMPTROLLER OF
THE CURRENCY ON PURCHASES OF INVESTMENT
SECURITIES
By virtue of the authority vested in the Comptroller of the Currency
by paragraph Seventh of Section 5136 of the Revised Statutes, the following regulation is promulgated:
SECTION I
(1) An obligation of indebtedness which may be purchased for its own
account by a national bank or State member bank of the Federal Reserve
System, in order to come within the classification of "investment securities" within the meaning of paragraph Seventh of said Section 5136, must
be a marketable obligation, i.e., it must be salable under ordinary circum.stances with reasonable promptness at a fair value; and with respect to
the particular security, there must be present one or more of the following characteristics:
(a) A public distribution of the securities must have been provided for or made in a manner to protect or insure the marketability
of the issue; or,
(b) Other existing securities of the obligor must have such a public distribution as to protect or insure the marketability of the issue
under consideration; or,
(c) In the case of investment securities for which a public distribution as set forth in (a) or (b) above cannot be so provided, or so
made, and which are issued by established commercial or industrial
businesses or enterprises, that can demonstrate the ability to service
such securities, the debt evidenced thereby must mature not later
than ten years after the date of issuance of the security and must be
of such sound value or so secured as reasonably to assure its payment; and such securities must, by their terms, provide for the amortization of the debt evidenced thereby so that at least 75 percent of
the principal will be extinguished by the maturity date by substantial periodic payments: Provided, That no amortization nee'd be required for the period of the first year after the date of issuance of
such securities.
(2) Where the security is issued under a trust agreement, the agreement must provide for a trustee independent of the obligor, and such
trustee must be a bank or trust company.
(3) All purchases of investment securities by national and State member banks for their own account must be of securities "in the form of
bonds, notes, and/or debentures, commonly known as investment securities"; and every transaction which is in fact such a purchase must,
regardless of its form, comply with this regulation.
SECTION II
(1) Although the bank is permitted to purchase investment securities" for its own account for purposes of investment under the provisions
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ANNUAL REPORT OF BOARD OF GOVERNORS
of Revised Statute 5136 and this regulation, the bank is not permitted
otherwise to participate as a principal in the marketing of securities.
(2) The statutory limitation on the amount of the "investment securities7' of any one obligor or maker which may be held by the bank, is to
be determined on the basis of the par or face value of the securities, and
not on their market value.
(3) The purchase of ''investment securities" in which the investment
characteristics are distinctly or predominantly speculative, or the purchase of securities which are in default, either as to principal or interest,
is prohibited.
(4) Purchase of an investment security at a price exceeding par is
prohibited, unless the bank shall:
(a) Provide for the regular amortization of the premium paid so
that the premium shall be entirely extinguished at or before the
maturity of the security and the security (including premium) shall
at no intervening date be carried at an amount in excess of that at
which the obligor may legally redeem such security; or
(b) Set up a reserve account to amortize the premium, said account to be credited periodically with an amount not less than the
amount required for amortization under (a) above.
(5) Purchase of securities convertible into stock at the option of the
issuer is prohibited.
(6) Purchase of securities convertible into stock at the option of the
holder or with stock purchase warrants attached is prohibited if the price
paid for such security is in excess of the investment value of the security
itself, considered independently of the stock purchase warrants or conversion feature. If it is apparent that the price paid for an otherwise
eligible security fairly reflects the investment value of the security itself
and does not include any speculative value based upon the presence of a
stock purchase warrant or conversion option the purchase of such a security is not prohibited.
(7) As to purchase of securities under repurchase agreement, subject to the limitations and restrictions set forth in the law and this regulation:
(a) It is permissible for the bank to purchase "investment securities" from another under an agreement whereby the bank has an
option or a right to require the seller of the securities to repurchase
them from the bank at a price stated or at a price subject to determination under the terms of the agreement, but in no case less than
the value at the time of repurchase.
(b) It is permissible for the bank to purchase "investment securities" from another under an agreement whereby the seller or a
third party guarantees the bank against loss on resale of the securities.
(c) It is not permissible for the bank to purchase "investment
securities" from another under an agreement whereby the seller reserves the right or the option to repurchase said securities itself or
through its nominee at a price stated or at a price subject to deter-
FEDERAL RESERVE SYSTEM
93
mination under the terms of the agreement, notwithstanding the fact
that the bank may also, under such agreement, have the right or
option to compel the seller to repurchase the securities at a price
stated or at a price subject to determination under the terms of the
agreement.
(8) As to repurchase agreements accompanying sales of securities,
(a) It is permissible for the bank selling securities to another to
agree that the bank shall have an option or right to repurchase the
securities from the buyer at a price stated or at a price subject to
determination under the terms of the agreement, but in no case in
excess of the market value at the time of repurchase.
(b) It is not permissible for the bank selling securities to another
to agree that the purchaser shall have the right or the option to require the bank to repurchase said securities at a price stated or at a
price subject to determination under the terms of the agreement,
notwithstanding the fact that the bank may also, under such agreement, have the right or option to repurchase the securities from the
buyer at a price stated or at a price subject to determination under
the terms of the agreement.
In view of the fact that some banks may have bought or sold securities
under a form of agreement which is prohibited by this regulation, the
bank should either terminate or modify same so as to conform to this
regulation, where such action may lawfully be taken. Existing agreements of the prohibited type must not be renewed.
EXCEPTION
The restrictions and limitations of this regulation do not apply to
securities acquired through foreclosure on collateral, or acquired in good
faith by way of compromise of a doubtful claim or to avert an apprehended loss in connection with a debt previously contracted, or to real
estate securities acquired pursuant to Section 24 of the Federal Reserve
Act, as amended.
This regulation supersedes prior regulations governing the purchase of
"investment securities" and is effective from and after July 1, 1938.
Signed and promulgated this 27th day of June, 1938.
MARSHALL R. DIGGS
Acting Comptroller of the Currency
DIRECTORY OF THE BOARD OF GOVERNORS OF THE
FEDERAL RESERVE SYSTEM
(December 31, 1938)
MARRINER S. ECCLES, of Utah, Chairman
RONALD RANSOM, of Georgia, Vice Chairman
M. S. SZYMCZAK, of Illinois
JOHN K. MCKEE, of Ohio
CHESTER C. DAVIS, of Maryland
ERNEST G. DRAPER, of Connecticut
LAWRENCE CLAYTON, Assistant to the Chairman.
ELLIOTT THURSTON, Special Assistant to the Chairman.
CHESTER MORRILL, Secretary.
LISTON P. BETHEA, Assistant Secretary.
S. R. CARPENTER, Assistant Secretary.
J. C. NOELL, Assistant Secretary.
WALTER WYATT, General Counsel.
J. P. DREIBELBIS, Assvitayxt General Counsel.
GEORGE B. VEST, Assistant General Counsel.
B. MAGRUDER WINGFIELD, Assistant General Counsel.
LEO H. PAULGER, Chief, Division of Examinations.
R. F. LEONARD, Assistant Chief, Division of Examinations.
C. E. CAGLE, Assistant Chief, Division of Examinations.
E. A. GOLDENWEISER, Director, Division of Research and Statistics.
WOODLIEF THOMAS, Assistant Director, Division of Research and Statistics.
LAUCHLIN CURRIE, Assistant Director, Division of Research and Statistics.
EDWARD L. SMEAD, Chief, Division of Bank Operations.
J. R. VAN FOSSEN, Assistant Chief, Division of Bank Operations.
J. E. HORBETT, Assistant Chief, Division of Bank Operations.
CARL E. PARRY, Chief, Division of Security Loans.
PHILIP E. BRADLEY, Assistant Chief, Division of Security Loans.
O. E. FOULK, Fiscal Agent.
JOSEPHINE E. LALLY, Deputy Fiscal Agent.
94
SALARIES OF OFFICERS AND EMPLOYEES OF THE BOARD
OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM
(December 31, 1938)
OFFICES OF MEMBERS OF THE BOARD
Lawrence Clayton, assistant to the Chairman
Elliott Thurston, special assistant to the Chairman
1 at $4,200
5 at $3,300
1 at $2,300
1 at $2,200
1 at $2,000
1 at $1,800
1 at $1,720
1 at $1,500
1 at $1,440
2 at $1,380
1 at $1,080
Total
$15,000.00
13,000.00
4,200.00
16,500.00
2,300.00
2,200.00
2,000.00
1,800.00
1,720.00
1,500.00
1,440.00
2,760.00
1,080.00
65,500.00
OFFICE OF THE SECRETARY
Chester Morrill, secretary
L. P. Bethea, assistant secretary
S. R. Carpenter, assistant secretary
J. C. Noell, assistant secretary
1 at $3,100
1 at $3,000.
2 at $2,900
1 at $2,800
3 at $2,700
1 at $2,500
1 at $2,400
4 at $2,100
1 at $2,040
1 at $2,000
1 at $1,980
1 at $1,920
2 at $1,800
1 at $1,720
5 at $1,620
3 at $1,600
3 at $1,560
2 at $1,500
1 at $1,440
1 at $1,380
2 at $1,320
7 at $1,200
1 at $1,140
2 at $1,080
Service Functions:
1 at $2,400
1 at $2,280
1 at $2,200
2 at $1,920
1 at $1,900
3 at $1,860
3 at $1.800
$15,000.00
8,000.00
7,500.00
7,500.00
3,100.00
3,000.00
5,800.00
2,800.00
8,100.00
2,500.00
2,400.00
8,400.00
2,040.00
2,000.00
1,980.00
1,920.00
3,600.00
1,720.00
8,100.00
4,800.00
4,680.00
3,000.00
1,440.00
1,380.00
2,640.00
8,400.00
1,140.00
2,160.00
*2,400.00
*2,280.00
2,200.00
*3,840.00
1,900.00
*5,580.00
5,400.00
95
9G
ANNUAL REPORT OF BOARD OF GOVERNORS
OFFICE OF T H E SECRETARY—continued
1
2
1
1
1
1
1
1
2
1
2
at
at
at
at
at
at
at
at
at
at
at
$1,680
$1,660
$1,620
$1,600
$1,560
$1,500
$1,500
$1,440
$1,380
$1,320
$1,200
1,680.00
3,320.00
1,620.00
1,600.00
1,560.00
*1,500.00
1,500.00
1,440.00
2,760.00
1,320.00
*2,400.00
1 at $1,140
3 at $1,080
1 at $5.00 per calendar day
Building Operation and Maintenance:
Felix E. Spurney, building manager. . . .
1 at $3,400
1 at $2,400
1 at $2,060
1 at $1,920
2 at $1,900
2 at $1,600
13 at $1,500
1 at $1,440
1 at $1,380
2 at $1,320
5 at $1,200
8 at $1,140
2 at $1,080
1 at $900
1 at $688.60
25 at $626
1 at $3.00 per working day
Total
Less salaries of telegraph operators. . .
1,140.00
3,240.00
§282.86
5,000.00
3,400.00
2,400.00
2,060.00
1,920.00
3,800.00
3,200.00
19,500.00
1,440.00
1,380.00
2,640.00
6,000.00
9,120.00
2,160.00
900.00
tl5,650.00
§81.00
255,402.46
18,000.00
237,402.46
OFFICE OF GENERAL COUNSEL
Walter Wyatt, general counsel
J. P. Dreibelbis, assistant general counsel
George B. Vest, assistant general counsel
B. M. Wingfield, assistant general counsel
Kit Williams, assistant counsel
John C. Baumann, assistant counsel
Joseph T. Owens, assistant counsel
G. Howland Chase, assistant counsel
Alfred K. Cherry, assistant counsel
1 at $4,500
1 at $4,200
1 at $3,300
2 at $3,000
1 at $2,800
*The salaries of ten employees in the telegraph office aggregating
regarded as an expense of the Federal Reserve Leased Wire System and
prorated among the Federal Reserve banks and the Board with the other
the Leased Wire System.
X Annual compensation based on a 4-hour working day at the rate
an hour.
f Annual compensation based on a 4-hour working day at the rate
an hour.
§ Actual amount paid.
$15,000.00
10,000.00
10,000.00
.
9,000.00
7,500.00
6,000.00
6,000.00
5,750.00
5,750.00
4,500.00
4,200.00
3,300.00
6,000.00
2,800.00
$18,000 are
as such are
expenses of
of 55 cents
of 50 cents
FEDERAL RESERVE SYSTEM
97
OFFICE OF GENERAL COUNSEL—continued
1
3
1
1
5
3
1
1
at
at
at
at
at
at
at
at
$2,200.
$2,100.
$2,000.
$1,960
$1,800.
$1,740.
$1,440. .
$1,380..
2,200.00
6,300.00
2,000.00
1,960.00
9,000.00
5,220.00
1,440.00
1,380.00
Total ..
125,300.00
DIVISION OF RESEARCH AND STATISTICS
E. A. Goldenweiser, director of division
Woodlief Thomas, assistant director
L. B. Currie, assistant director
Walter R. Gardner, senior economist
Frank R. Garfield, senior economist
Alan R. Sweezy, senior economist
George Terborgh, senior economist
Susan Burr Litchfield, senior economist
Leroy M. Piser, senior economist
Roman L. Home, senior economist
3 at $4,600
1 at $4,400
1 at $4,200
1 at $4,100
1 at $4,000. ...
4 at $3,600 ...
3 at $3,500 . .
1 at $3,200. ...
2 at $3,100..
5 at $3,000
1 at $2,700
1 at $2,600
3 at $2,400. ...
at $2,300
at $2,200
3 at $2,100.
3 at $2,000.
4 at $1,900.
6 at $1,800.
7 at $1,780.
3 at $1,700.
1 at $1,660.
5 at $1,620.
2 at $1,600.
5 at $1,540.
4 at $1,440.
1 at $1,400.
1 at $1,320.
2 at $1,200.
1 at $1,140
1 at $1,080.
1 at
265,920.00
Total
DIVISION OF BANK OPERATIONS
E. L. Smead, chief of division. . .^
John R. Van Fossen, assistant chief
J. E. Horbett, assistant chief
L. S. Myrick, technical assistant
Bray Hammond, technical assistant
1 at $4,800
$15,000.00
9,000.00
8,500.00
7,500.00
6,000.00
5,600.00
5,600.00
5,400.00
5,400.00
5,000.00
13,800.00
4,400.00
4,200.00
4,100.00
4,000.00
14,400.00
10,500.00
3,200.00
6,200.00
15,000.00
2,700.00
2,600.00
7,200.00
9,200.00
8,800.00
6,300.00
6,000.00
7,600.00
10,800.00
12,460.00
5,100.00
1,660.00
8,100.00
3,200.00
7,700.00
5,760.00
1,400.00
1,320.00
2,400.00
1,140.00
1,080.00
600.00
15,000.00
8,500.00
7,500.00
6,200.00
5,400.00
4,800.00
98
ANNUAL REPORT OF BOARD OF GOVERNORS
DIVISION OF BANK OPERATIONS—continued
1
2
1
1
1
1
1
1
1
3
1
2
1
2
3
3
1
5
1
2
1
2
1
at
at
at
at
at
at
at
at
at
at
at
at
at
at
at
at
at
at
at
at
at
at
at
$4,400
$4,000
$3,900
$3,800
$3,200
$3,100
$3,000
$2,900. .
$2,800
$2,700
$2,500
$2,400
$2,200
$2,000
$1,800
$1,740
$1,700
$1,680
$1,620
$1,600
$1,560
$1,320
$1,080
. ..
Total
4}400 00
8,00000
3,900.00
3,800.00
3,200.00
3,100.00
3,000.00
2,900.00
2,800.00
8,100.00
2,500.00
4,800.00
2,200.00
4,000.00
5,400.00
5,220.00
1,700.00
8,400.00
1,620.00
3,200.00
1,560.00
2,640.00
1,080.00
134,920.00
DIVISION OF EXAMINATIONS
Leo H. Paulger, chief of division
R. F. Leonard, assistant chief .
C. E. Cagle, assistant chief
L. A. A. Siems, Federal reserve examiner
M. R. Wilkes, Federal reserve examiner
H. O. Koppang, Federal reserve examiner
R. B. Chamberlin, Federal reserve examiner
15,000.00
10,000.00
8,500.00
\ ..
7,500.00
6,600.00
6,500.00
6,000.00
Edwin R. Millard, Federal reserve examiner
6,000.00
Geo. S. Sloan, Federal reserve examiner
Dwight L. Crays, Federal reserve examiner
William B. Pollard, Federal reserve examiner
Clarence C. Hostrup, Federal reserve examiner
Fred A. Nelson, Federal reserve examiner
C. S. Barker, assistant Federal reserve examiner
6,000.00
5,500.00
5,500.00
5,300.00
5,300.00
5,200.00
J. B. Crosby, Federal reserve examiner
5,200.00
Elisha L. Brien, Jr., Federal reserve examiner
Laurence H. Jones, Federal reserve examiner
1 at $4,900
2 at $4,800
2 at $4,600
5,000.00
5,000.00
4,900.00
9,600.00
9,200.00
1 at $4,500
1 at $4,400
3 at $4,300
1 at $4,200
2 at $4,000
1 at $3,700
2 at $3,600
3 at $3,400
1 at $3,300
1 at $2,900
1 at $2,800
3 at $2,700
1 at $2,600
1 at $2,500
2 at $2,400
1 at $2,300
4 at $2,100
2 at $2,000
4,500.00
4,400.00
12,900.00
4,200.00
8,000.00
3,700.00
7,200.00
10,200.00
3,300.00
2,900.00
2,800.00
8,100.00
2,600.00
2,500.00
4,800.00
2,300.00
8,400.00
4,000.00
FEDERAL RESERVE SYSTEM
99
DIVISION OF EXAMINATIONS—continued
3
1
1
2
1
1
2
at
at
at
at
at
at
at
$1,900
$1,820
$1,800
$1,740
$1,560
$1,460
$1,320
5,700.00
1,820.00
1,800.00
3,480.00
1,560.00
1,460.00
2,640.00
Total
253,060.00
DIVISION OF SECURITY LOANS
Carl E. Parry, chief of division
Philip E. Bradley, assistant chief
2 at $3,600
1 at $2,400. . . . :
1 at $2,300
1 at $2,100
1 at $1,800
1 at $1,140
Total
34,440.00
OFFICE OF FISCAL AGENT
Oliver E. Foulk, fiscal agent
Josephine E. Lally, deputy fiscal agent
Total
Grand Total
10,000.00
7,500.00
7,200.00
2,400.00
2,300.00
2,100.00
1,800.00
1,140.00
4,500.00
2,600.00
7,100.00
.
. . . . 1,123,642.46
RECEIPTS AND DISBURSEMENTS OF THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM
FOR THE YEAR 1938
Special fund account:
Balance January 1, 1938:
Available for general expenses of the Board
Available for expenses chargeable to Federal Reserve banks
$187,536.37
107,267.53
Total
$294,803.90
RECEIPTS
Available for general expenses of the Board:
Assessments on Federal Reserve banks for general expenses
of the Board
$1,724,922.40
Reimbursements for leased wire service
29,228.82
Subscriptions to the Federal Reserve Bulletin
6,324.42
Miscellaneous receipts, refunds, and reimbursements
5,762.34
Total receipts available for general expenses of the Board
$1,766,237.98
Available for expenses chargeable to Federal Reserve banks:
Assessments on Federal Reserve banks for:
Cost of printing Federal Reserve notes
$1,143,588.60
Expenses of leased wire system (telegraph)
66,261.51
Expenses of leased telephone lines
28,395.59
Expenses of the Federal Reserve Issue and Redemption
Division (office of Comptroller of the Currency)
57,221.77
Miscellaneous expenses
6,751.37
•Total receipts available for expenses chargeable to Federal Reserve
banks
$1,302,218.84
Total receipts
3,068,456.82
Total available for disbursement
DISBURSEMENTS
For general expenses of the Board:
Expenses of 1937 paid in 1938
Expenses of 1938 (per detailed statement)
$1,707,503.67
Less accounts unpaid December 31, 1938
20,188.89
Expenses of 1938 paid during the year
Expenses of leased wire service, reimbursable
Miscellaneous refunds and reimbursable expenses
3,363,260.72
$69,971.00
1,687,314.78
29,081.97
4,463.20
Total disbursements for general expenses of the Board
$1,790,830.95
For expenses chargeable to Federal Reserve banks:
Cost of printing Federal Reserve notes
1,170,208.60
Expenses of leased wire system (telegraph)
66,261.51
Expenses of leased telephone lines
28,395.59
Expenses of Federal Reserve Issue and Redemption Division
(office of Comptroller of theCurrency)
57,221.77
Miscellaneous expenses
7,312.27
Total disbursements for expenses chargeable to Federal Reserve banks..
Transfers from special fund account to building account
1,329,399.74
73,619.26
Total disbursements and transfers
3,193,849.95
Balance in special fund account December 31, 1938:
Available for general expenses of the Board
Available for expenses chargeable to Federal Reserve banks
89,324.14
80,086.63
169,410.77
Building account:
Balance January 1, 1938
Transfers from special fund account
Miscellaneous receipts
Total
Disbursements
Balance
100
$32,738.61
73,619.26
614.63
106,972.50
106,972.50
0.00
FEDERAL RESERVE SYSTEM
101
STATEMENT OF EXPENSES OF THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE
SYSTEM, 1938
PERSONAL SERVICES
Salaries
$1,209,649.26
Retirement System contributions for current service
54,889.18
Sub-total
Retirement System contributions for prior service
TotalPersonal Services
NON-PEESONAL SERVICE
Traveling Expenses
Postage andExpressage
Telephone and Telegraph
Printing andBinding
Stationery and Supplies
Furniture andEquipment
Books and Subscriptions
Light, Heat, Power and Water.
Repairs and Alterations to Building
Rental and Repairs (Furniture andEquipment)
Medical Service and Supplies
Insurance
Miscellaneous
$1,264,538.44
163,370.88
$1,427,909.32
$
'.
75,910.79
1,220.01
63,666.68
45,792.55
20,044.49
26,751.99
5,357.91
24,419.75
2,852.41
2,377.48
493.58
2,621.14
8,085.57
Total Non-Personal Services
$ 279,594.35
GRAND TOTAL
$1,707,503.67
DIRECTORY OF THE FEDERAL OPEN MARKET COMMITTEE
(December 31, 1938)
MARRINER S. ECCLES, Chairman
GEORGE L. HARRISON, Vice Chairman
CHESTER C. DAVIS
ERNEST G. DRAPER
JOHN K. MCKEE
OSCAR NEWTON
J. N. PEYTON
RONALD RANSOM
G. J. SCHALLER
JOHN S. SINCLAIR
M. S. SZYMCZAK
CHESTER MORRILL, Secretary
S. R. CARPENTER, Assistant Secretary
WALTER WYATT, General Counsel
J. P. DREIBELBIS, Assistant General Counsel
E. A. GOLDENWEISER, Economist
JOHN H. WILLIAMS, Associate Economist
ALLAN SPROUL, Manager oj System Open Market Account
102
DIRECTORY OF THE FEDERAL ADVISORY COUNCIL
(December 31, 1938)
OFFICERS
President, WALTER W. SMITH
Vice President, HOWARD A. LOEB
Secretary, WALTER LICH TEN STEIN
EXECUTIVE COMMITTEE
WALTER W. SMITH
HOWARD A. LOEB
THOMAS M. STEELE
WINTHROP W. ALDRICH
LEWIS B. WILLIAMS
EDWARD E. BROWN
MEMBERS
District No. 1.—THOMAS M. STEELE, President, First National Bank & Trust Company of New Haven, Connecticut.
District No. 2.—WINTHROP W. ALDRICH, Chairman, The Chase National Bank of
the City of New York, New York, New York.
District No. 3.—HOWARD A. LOEB, Chairman, Tradesmens National Bank & Trust
Company, Philadelphia, Pennsylvania.
District No. 4.—LEWIS B. WILLIAMS, Chairman, The National City Bank, Cleveland,
Ohio.
District No. 5.—ROBERT M. HANES, President, Wachovia Bank and Trust Company,
Winston-Salem, North Carolina.
District No. 6.—EDWARD BALL, C/O Barnett National Bank Building, Jacksonville,
Florida,
District No. 7.—EDWARD E. BROWN, President, The First National Bank of Chicago,
Chicago, Illinois.
District No. 8.—WALTER W. SMITH, President, First National Bank in St. Louis,
St. Louis, Missouri.
District No. 9.—JOHN CROSBY, Vice President, Farmers and Mechanics Savings Bank,
Minneapolis, Minnesota.
District No. 10.—C. Q. CHANDLER, Chairman, First National Bank in Wichita,
Wichita, Kansas.
District No. 11.—R. E. HARDING, President, The Fort Worth National Bank, Fort
Worth, Texas.
District No. 12.—PAUL S. DICK, President, United States National Bank, Portland,
Oregon.
103
104
ANNUAL REPORT OF BOARD OF GOVERNORS
CHAIRMEN, DIRECTORS, PRESIDENTS AND FIRST VICE
PRESIDENTS OF FEDERAL RESERVE BANKS
(December 31, 1938)
DISTRICT NO. 1—BOSTON
DISTRICT NO. 4—CLEVELAND
F. H. CURTISS, chairman and Federal Reserve E. S. BURKE, JR., chairman and Federal Reserve
agent, H. S. DENNISON, deputy chairman,
agent, G. C. BRAINARD, deputy chairman,
R. A. YOUNG, president, W. W. PADDOCK, first
vice president
M.
J.
FLEMING,
president,
first vice president
Directors
Class A:
Allan Forbes, Boston, Mass
L. A. Dodge, Damariscotta, Me
L. S. Reed, Waterbury, Conn
Class B:
P. R. Allen, E. Walpole, Mass
E. J. Frost, Boston, Mass
E. S. French, Boston, Mass
Class C:
F. H. Curtiss, Boston, Mass
H. S. Dennison, Framingham, Mass
H . I . Harriman, Boston, Mass
Term
expires
Dec. 31
1938
1939
1940
1938
1939
1940
1938
1939
1940
vice president
Class A:
O. A. Thompson, Norwich, N. Y
W. F. Ploch, Long Beach, N. Y
W. C. Potter, New York, N. Y
Class B:
W. C. Teagle, New York, N. Y
R. T. Stevens, New York, N. Y
T. J. Watson, New York, N. Y
Class C:
Beardsley Ruml, New York, N. Y
E . E . Day, Ithaca, N. Y
O.D. Young, New York, N. Y
J.
ZURLINDBN,
Directors
Term
expires
Dec. 31
Class A:
F.F. Brooks, Pittsburgh, Pa
B.R. . Conner, Ada, Ohio
H.B . McDowell, Sharon, Pa
Class B:
G.D . Crabbs, Cincinnati, Ohio....
J.E. Galvin, Lima, Ohio
R.P. Wright, Erie, Pa
Class C:
E. S. Burke, Jr., Cleveland, Ohio...
R.E. Klages, Columbus, Ohio
G.C. Brainard, Youngstown, Ohio
DISTRICT NO. 2—NEW YORK
O. D. YOUNG, chairman and Federal Reserve
agent, BBARDSLEY RTJML,
deputy
chairman,
G. L. HARRISON, president, ALLAN SPROUL, first
F.
1938
1939
1940
1938
1939
1940
1938
1939
1940
CINCINNATI BRANCH
B. J. LAZAR, managing director
B. J. Lazar, Cincinnati, Ohio
J. J. Rowe, Cincinnati, Ohio
Alexander Thomson, Hamilton, Ohio
W. H. Courtney, Lexington, Ky
S. B. Sutphin, Cincinnati, Ohio
1938
1938
1938
1939
1939
PITTSBURGH BRANCH
P. A. BROWN, managing director
P. A. Brown, Pittsburgh, Pa
G. T. Ladd, Pittsburgh, Pa
S. W. Harper, Wheeling, W. Va
Clarence Stanlev, Pittsburgh, P a . . .
H. S. Wherrett, Pittsburgh, Pa
BUFFALO BRANCH
R. M. O'HARA, managing director
1938
1938
1938
1939
1939
DISTRICT NO. 5—RICHMOND
ROBERT LASSITER, chairman and Federal Reserve
agent, W. G. WYSOR, deputy chairman, HUGH
LEACH, president, J. S. WALDEN, JR., first vice
R. M. O'Hara, Buffalo, N. Y
F. F. Henry, Buffalo, N. Y
M. B. Folsom, Rochester, N. Y
F. J. Coe, Niagara Falls, N. Y
F. A. Prole, Batavia, N. Y
Howard Kellogg, Buffalo, N. Y
W. A. Dusenbury, Olean, N. Y
president
Class A:
L.E. Johnson, Alderson, W. Va
C. E. Rieman, Baltimore, Md
J. C. Braswell, Rocky Mount, N. C
Class B:
Edwin Malloy, Cheraw, S. C
C. C. Reed, Richmond, Va
DISTRICT NO. 3-PHILADELPHIA
J.H.Hanna, Washington, D.C
R. L. AUSTIN, chairman and Federal Reserve Class C:
agent, T. B . MCCABE, deputy chairman, J . S.
Donald Sherwood, Baltimore, Md
SINCLAIR, president, F . J. DRINNEN, first vice
W. G. Wysor, Richmond, Va
president
Robert Lassiter, Richmond, Va
1938
1939
1940
Class A:
Joseph Wayne, Jr., Philadelphia, Pa
G. W . Reily, Harrisburg, P a
J. B . Henning, Tunkhannock, Pa
Class B :
A. W . Sewall, Philadelphia, Pa
J. C. DeLaCour, Camden, N . J
C. F . C. Stout, Camden, N . J
Class C :
R. L. Austin, Philadelphia, P a
T . B . McCabe, Chester, P a .
Francis Biddle, Philadelphia, Pa
1938
1938
1938
1939
1939
1940
1940
1938
1939
1940
1938
1939
1940
1938
1939
1940
1938
1939
1940
1938
1939
1940
BALTIMORE BRANCH
W. R. MILFORD, managing director
I W. R. Milford, Baltimore, Md
W. F. Thomas, Westminster, Md
L. S. Zimmerman,Baltimore,Md...
C. P. McCormick, Baltimore, M d . . . .
M. M. Prentis, Baltimore, Md
James Dixon,Easton, Md
W. F. Roberts, Baltimore, Md
105
FEDERAL RESERVE SYSTEM
DISTRICT NO. 5—RICHMOND—Continued
CHARLOTTE BRANCH
W. T. CLEMENTS, managing director
Directors
Term
expires
Dec. 31
W. T. Clements, Charlotte, N. C
G. S. Harris, Lancaster, S. C
C. L. Cobb, Rock Hill, S. C
Christie Benet, Columbia, S. C
B. M.Edwards, Columbia, S. C
T.E. Hemby, Charlotte, N. C
G. M. Wright, Great Falls, S. C
1938
1938
1938
1939
1939
1940
1940
DISTRICT NO. 6—ATLANTA
F. IT. NEELY, chairman and Federal Reserve
agent,
, deputy chairman, OSCAR
NEWTON, president, R. S. PARKER, first vice
president
DISTRICT NO. 6—ATLANTA—Continued
NEW ORLEANS BRANCH
L. M. CLARK, managing director
Directors
L. M. Clark, New Orleans, La
H. Holmes, Yazoo City, Miss
Alexander Fitz-Hugh, Vicksburg, Miss
E.E. Soulier, Lafayette, La
H. G. Chalkley, Jr., Lake Charles, La
O. G. Lucas, New Orleans, La
Vacancy
1938
1938
1938
1940
1940
DISTRICT NO. 7—CHICAGO
.— > chairman and Federal Reserve
agent. R. E. WOOD, deputy chairman. G. J.
SCHALLER, president, H. P. PRESTON, first vice
president
Class A:
F.D.Williams, Iowa City, Iowa
W. J. Cummings, Chicago, 111
E. R. Estberg, Waukesha, Wis
Class B:
N. H.Noyes, Indianapolis, Ind
M. W. Babb, Milwaukee, Wis
S. T. Crapo, Detroit, Mich
Class C:
R.E. Wood, Chicago, 111
Vacancy
F. J. Lewis, Chicago, 111
Class A:
.
•
G. J. White, Mount Dora, Fla
R. G. Clay, Atlanta, Ga
W. D. Cook, Meridian, Miss
Class B:
«E. T. George, New Orleans, La
J. A. McCrary, Atlanta, Ga
Fitzgerald Hall, Nashville, Tenn
Class C:
F. H. Neely, Atlanta, Ga
J. F. Porter, Columbia, Tenn
R. C. Harris,New Orleans, La
Term
expires
Dec. 31
1938
1939
1940
1938
1939
1940
1938
1939
1940
DETROIT BRANCH
R. H. Buss, managing director
BIRMINGHAM BRANCH
P. L. T. BEAVERS, managing director
P. L. T. Beavers, Birmingham, Ala
F. M. Moody, Tuscaloosa, Ala
Donald Comer, Birmingham, Ala
J. C. Persons, Birmingham, Ala
Howard Gray, New Market, Ala
E. L. Norton, Birmingham, Ala
J. S. Coleman, Birmingham, Ala
JACKSONVILLE BRANCH
G. S. VARDEMAN, Jr., managing director
G. S. Vardeman, Jr., Jacksonville, Fla..
W. R. McQuaid, Jacksonville, Fla
R. H. Gamble, Jacksonville, Fla
G. J. Avent, Jacksonville, Fla
Howard Phillips, Orlando, Fla
G. J. White, Mount Dora, Fla
B. W. Haynes, Jacksonville, Fla
NASHVILLE BRANCH
J. B. FORT, Jr., managing director
J. B. Fort, Jr., Nashville, Tenn
C. W. Bailey, Clarksville, Tenn
C. B. Austin, Greeneville, Tenn
F. M. Farris, Nashville, Tenn
W. E. McEwen, Williamsport, Tenn
E. W. Palmer, Kingsport, Tenn
G. N. Bass, Decherd, Tenn
1938
1938
1938
1939
1939
1940
1940
R. H. Buss, Detroit, Mich
J. M. Dodge, Detroit, Mich
L. W. Watkins, Manchester, Mich
J.E. Davidson, Bay City, Mich
H. L. Pierson, Detroit, Mich
W. S. McLucas, Detroit, Mich
A. C. Marshall, Detroit, Mich
1938
1938
1938
1939
1939
1940
1940
DISTRICT NO. 8—ST. LOUIS
W. T. NARDIN, chairman and Federal Reserve
agent,
, deputy chairman, W.
McC. MARTIN, president, F. G. HITT, first vice
president
Class A:
J. G. Lonsdale, St. Louis, Mo
M. B. Nahm, Bowling Green, Ky
G. R. Corlis, Anna, 111
Class B:
M. P. Sturdivant, Glendora, Miss
J. W. Harris, St. Louis, Mo
H. C. Couch, Pine Bluff, Ark
Class C:
J. R. Stanley, Evansville, Ind
W. T. Nardin, St. Louis, Mo
Oscar Johnston, Scott, Miss
1938
1939
1940
1938
1939
1940
1938
1939
1940
LITTLE ROCK BRANCH
A. F. BAILEY, managing director
A. F. Bailey, Little Rock, Ark
H. H. Tucker, Little Rock, Ark
P. R. McCoy, Stuttgart, Ark
F. K. Darragh, Little Rock, Ark
J. H. Penick, Little Rock, Ark
A. E. McLean, Little Rock, Ark
I. N. Barnett, Jr., Batesville, Ark
1938
1938
1938
1939
1939
1940
1940
106
ANNUAL REPORT OF BOARD OF GOVERNORS
DISTRICT NO. 8—ST. LOUIS—Continued
LOUISVILLE BRANCH
F. D. RASH, managing director
DISTRICT NO. 10—KANSAS CITY—Continued
DENVER BRANCH
J. E. OLSON, managing director
Term
expires
Dec. 31
Directors
F. D. Rash, Louisville, Ky
J. B. Hill, Louisville, Ky
W. R. Cobb, Louisville, Ky
W. P. Paxton, Paducah, Ky
J. 0 . Sanders, Huntingburg, Ind
A. H.Eckles, Hopkinsville, Ky
P. B. Gaines, Carrollton, Ky
1938
1938
1938
1939
1939
1940
1940
MEMPHIS BRANCH
Term
expires
Directors
Dec. 31
J.E. Olson,Denver, Colo
T. A. Dines, Denver, Colo
J. B. Grant, Denver, Colo
Wilson McCarthy, Denver, Colo
R. H. Davis, Denver, Colo
A. K. Mitchell, Albert, N. M
W. C. Kurtz, Grand Junction, Colo
1938
1938
1938
1939
1939
1940
1940
OKLAHOMA CITY BRANCH
W. H. GLASGOW, managing director
W. H. Glasgow, Memphis, Tenn
Willis Pope, Columbus, Miss
J. H. Sherard, Sherard, Miss
W. R. King, Memphis, Tenn
D. W. Brooks, Memphis, Tenn
B. A. Lynch, Blytheville, Ark
R. C. Branch, Pecan Point, Ark
1938
1938
1938
1939
1939
1940
1940
DISTRICT NO. 9-MINNEAPOLIS
W. B. GEERY, chairman and Federal Reserve
PEYTON,
president,
0.
S.
POWELL,
first
C. E. DANIEL, managing director
C. E. Daniel, Oklahoma City, Okla
L. D.Edgington, Ponca City, Okla
Clarence Roberts, Oklahoma City, Okla
F. T. Chandler, Chickasha, Okla
T. S. Hanna, Oklahoma City, Okla
Lee Clinton, Tulsa, Okla
S. W. Hayes, Oklahoma City, Okla
OMAHA
J. N .
vice
president
1938
1938
1938
1939
1939
1940
1940
BRANCH
L. H. EARHART, managing director
Class A:
H. R. Kibbee, Mitchell, S.D
H. C. Hansen, Churchs Ferry, N. D
M. 0 . Grangaard, Minneapolis, Minn
Class B:
J . E . O'Connell, Helena, Mont
A. P. Funk, LaCrosse, Wis
W. 0 . Washburn, St. Paul, Minn
Class C:
W. B. Geery, Minneapolis, Minn
W. C. Coffey, St. Paul, Minn
W. D. Cochran, Iron Mountain, Mich
1938
1939
1940
1938
1939
1940
1938
1939
1940
DISTRICT NO. 11—DALLAS
, B . A.
MCKINNEY, president, R. R. GILBERT, first vice
R. E. TOWLB, managing director
president
1938
1938
1938
1939
1939
Class A:
Alf Morris, Winnsboro, Tex
E. H. Winton, Fort Worth, Tex
P.E. Hooks, Itasca, Tex
Class B:
J. D. Middleton, Greenville, Tex
T T? TVTilnm Wnpn T P V
H. C. Wiess, Houston, Tex
DISTRICT NO. 10—KANSAS CITY
Class C:
J. H. Merritt, Dallas, Tex
J. J. THOMAS, chairman and Federal Reserve
Jay Taylor, Amarillo, Tex
agent, R. B. CALDWELL, deputy chairman , G. H.
Vacancy.
HAMILTON, president, C. A. WORTHINGTON,
vice president
Class AE . E . Mullaney, Hill City, K a n s
John Evans, Denver, Colo
F . W . Sponable, Paola, Kans
Class B :
L . E . Phillips, Bartlesville, Okla
W. D . Hosford, Omaha, Nebr
J. M . Bernardin, Dawson, N . M
Class C :
J. J. Thomas, Kansas City, Mo
E . P . Brown, Davey, Nebr
R. B . Caldwell, Kansas City, Mo
1938
1938
1938
1939
1939
1940
1940
J. H. MERRITT, chairman and Federal R e s e r v e
HELENA BRANCH
R.E.Towle, Helena, Mont
J.E. O'Connell, Helena, Mont
A. R. McDermott, Billings, Mont
Peter Pauly, Deer Lodge, Mont
H. D. Myrick, Square Butte, Mont
L. H.Earhart, Omaha, Nebr
R. E. Campbell, Lincoln, Nebr
G. H. Yates, Omaha, Nebr
W. D. Clark, Omaha, Nebr
H. L. Dempster, Beatrice, Nebr
W. H. Schellberg, Omaha, Nebr
G. A. Bible, Rawlins, Wyo
first
1938
1939
1940
1938
1939
1940
1938
1939
1940
EL PASO BRANCH
1938
1939
1940
1938
1939
1940
1938
1939
1940
J. L. HERMANN, managing director
J. L. Hermann, El Paso, Tex
F. R. Coon, Deming, N. M
F. M. Hayner, Las Cruces, N. M
S. D. Young, El Paso, Tex
R.E. Sherman,El Paso, Tex
J. B. Martin, Tucson, Ariz
C. N. Bassett, El Paso, Tex
1938
1938
1938
1939
1939
1940
1940
107
FEDERAL RESERVE SYSTEM
DISTRICT NO. 11—DALLAS—Continued
HOySTON
BRANCH
LOS A N G E L E S B R A N C H
W. N. AMBROSE, managing director
W. D . GENTRY, managing director
Directors
W. D. Gentry, Houston, Tex
S. R. Lawder, Houston, Tex.
H. Renfert, Galveston, Tex
Sam Taub, Houston, Tex
P . B . D o t y , Beaumont,Tex
G. G. Chance, Bryan, Tex
J. W. Neal, Houston, Tex
DISTRICT NO. 12—SAN FRANCISCO—Con.
Term
expires
Dec. 31
1938
1938
1938
1939
1939
1940
1940
Term
expires
Dec. 31
Directors
W. N. Ambrose, Los Angeles, Calif
V. H. Rossetti, Los Angeles, Calif
W. S. Rosecrans, Alhambra, Calif
C. E. Brouse, Riverside, Calif
C.V.Newman, Santa Ana, Calif
PORTLAND
1938
1938
1938
1939
1939
BRANCH
R. B. WEST, managing director
SAN ANTONIO B R A N C H
M. CRUMP, managing director
M. Crump, San Antonio, Tex
J. K. Beretta, San Antonio, Tex
Vacancy
E. F. Flato, Corpus Christi, Tex
G. C. Hollis, Eagle Pass, Tex
C. M. Bartholomew, Austin, Tex
Dolph Briscoe, Uvalde, Tex
1938
1938
1938
1939
1939
1940
1940
R. B. West, Portland, Ore
R. S. Smith, Eugene, Ore
A. E.Engbretsen, Astoria, Ore
N. A.Davis, Walla Walla, Wash
E. B. MaeNaughton, Portland, Ore
G. T. Gerlinger, Portland, Ore
SALT L A K E C I T Y
1938
1938
1938
1938
1939
1939
BRANCH
W. L. PARTNER, managing director
DISTRICT NO. 12—SAN FRANCISCO
, chairman and Federal Reserve
agent, ST. GEORGE HOLDEN, deputy chairman,
W. A. DAY, president, IRA CLERK, first vice
president
Class A:
T. H. Ramsay, San Francisco, Calif
Keith Powell, Salem, Ore
C.K.McIntosh.SanFrancisco,Calif
Class B :
W. G. Volkmann, San Francisco, Calif...
R. H. Taylor, Los Angeles, Calif
E. H. Cox, San Francisco, Calif
Class C:
Vacancy
Carlyle Thorpe, Los Angeles, Calif
St. George Holden, San Francisco, Calif..
1938
1939
1940
1938
1939
1940
1938
1939
1940
W. L. Partner, Salt Lake City, Utah
John Thomas, Gooding, Idaho
O. W. Adams, Salt Lake City, Utah
H. S. Auerbach, Salt Lake City, Utah
F. P . Champ, Logan, Utah
SEATTLE
1938
1938
1938
1939
1939
BRANCH
C. R. SHAW, managing director
C. R. Shaw, Seattle, Wash
FredNelson, Seattle, Wash
B. N . Phillips, Port Angeles, Wash
N. A. Telyea, Spokane, Wash
G. H. Greenwood, Seattle, Wash
C. F. Larrabee, Bellingham, Wash
1938
1938
1938
1938
1939
1939
108
ANNUAL REPORT OF BOARD OF GOVERNORS
NUMBER AND SALARIES OF OFFICERS AND EMPLOYEES OF
FEDERAL RESERVE BANKS
(December 31, 1938)
Federal Reserve Bank
(including
branches)
Other officers
Annual
salary of
President
Number
Annual
salaries
Employees,
except those
whose salaries
are reimbursed
to bank
Number
Annual
salaries
Employees
whose salaries
are reimbursed
to bank
Number
Total
Annual
salaries
Number
717 $1,169,930
2,310 4,843,882
783 1,386,388
973 1,734,427
Annual
salaries
$30,000
50,000
25,000
25,000
9
39
10
18
$87,000
439,800
94,200
147,400
606
1,941
668
845
$923,000
3,769,082
1,104,796
1,375,662
101
329
104
109
$129,930
585,000
162,392
186,365
Richmond
Atlanta
Chicago
St. Louis
21,000
25,000
35,000
20,000
17
20
22
21
120,000
129,420
210,000
159,100
512
386
1,038
495
760,392
507,960
1,659,764
686,244
151
347
470
152
193,642
424,328
672,775
210,295
681
754
1,531
669
1,095,034
1,086,708
2,577,539
1,075,639
Minneapolis
Kansas City
Dallas
San Francisco
25,000
25,000
30,000
25,000
13
18
14
26
82,600
141,700
102,800
188,300
249
460
358
692
396,131
716,950
582,958
1,150,949
105
143
236
183
150,249
210,282
315,892
278,911
368
622
609
902
653,980
1,093,932
1,031,650
1,643,160
330,000
227
1,902,320
8,250
13,633,888
2,430
3,520,061
Boston
New York
Philadelphia
Cleveland
Total
10,919 19,392,269
FEDERAL RESERVE SYSTEM
109
STATE BANK AND TRUST COMPANY MEMBERS
Following is a list of the 1,114 State bank and trust company members of the Federal Reserve System on December 31, 1938.
DISTRICT NO. 1 (42 banks)
CONNECTICUT (5 banks)
Hartford
Phoenix State Bank & Trust
Co.
New' Haven
Union & New Haven Trust Co.
Torrington
Brooks Bank & Trust Co.
Waterbury
Colonial Trust Co.
Waterbury Trust Co.
MAINE (5 banks)
Augusta
Depositors Trust Co.
Bangor
Merrill Trust Co.
Bar Harbor .. ., Bar Harbor Banking & Trust
Co.
Ellsworth
Union Trust Co.
Sanford
Sanford Trust Co.
MASSACHUSETTS (29 banks)
Menotomy Trust Co.
Arlington
New England Trust Co.
Boston
Old Colony Trust Co.
Pilgrim Trust Co.
State Street Trust Co.
United States Trust Co.
Bridgewater Trust Co.
Bridgewater
Norfolk County Trust Co.
Brookline
County Bank & Trust Co.
Harvard Trust Co.
Cambridge
B. M. C. Durfee Trust Co.
Fall River Trust Co.
Fall River
Gloucester Safe Deposit
Trust Co.
Franklin County Trust Co.
Hadley Falls Trust Co.
Hyannis Trust Co.
Security Trust Co.
Blue Hill Bank & Trust Co.
Newton Trust Co.
Norwood Trust Co.
Quincy Trust Co.
Naumkeag Trust Co.
Somerville Trust Co.
Springfield Safe Deposit
Trust Co.
Union Trust Co.
Taunton
Bristol County Trust Co.
Wellesley Hills ... Wellesley Trust Co.
Winchester
Winchester Trust Co.
Worcester
Worcester County Trust Co.
Gloucester
Greenfield ..
Holyoke
Hyannis
Lynn
Milton
Newton
Norwood
Quincy
Salem
Somerville
Springfield
NEW HAMPSHIRE (1 bank)
Carroll County Trust Co.
RHODE ISLAND (2 banks)
Providence
Industrial Trust Co.
Union Trust Co.
DISTRICT NO. 2 (173 banks)
NEW J E R S E Y 1 (49 banks)
Hayonne
Bayonne Trust Co.
Bloomfield
Bloomfield Bank & Trust Co.
'
< Community Trust Co.
Bogota
Bank of Bogota
Boonton
Boonton Trust Co.
Carteret
Carteret Bank & Trust Co.
Cranford
Cranford Trust Co.
Dover
Dover Trust Co.
Dunellen
Peoples Trust Co.
East Orange
. Savings Investment & Trust
Co.
Elizabeth
. . . Central Home Trust Co.
Elizabethport Banking Co.
Fort Lee
Fort Lee Trust Co.
Franklin
Sussex County Trust Co.
Glen Ridge .... Glen Ridge Trust Co.
Glen Rock
Glen Rock Bank
Hackensack
Hackensack Trust Co.
Peoples Trust Co. of Bergen
County
Con way
DISTRICT NO. 2—Continued
NEW JERSEY—continued
Jersey City
Commercial Trust Co. of New
Jersey
New Jersey Title Guarantee &
Trust Co.
Linden
Linden Trust Co.
Montclair
Bank of Montclair
Montclair Trust Co.
Morristown
Morristown Trust Co.
Newark
Clinton Trust Co.
Columbus Trust Co.
Federal Trust Co.
Fidelity Union Trust Co.
Franklin-Washington Trust Co.
Merchants & Newark Trust Co.
United States Trust Co.
West Side Trust Co.
Nutley
Bank of Nutley
Passaic
Bank of Passaic & Trust Co.
Peoples Bank & Trust Co.
Paterson
Hamilton Trust Co.
Perth Amboy . . . . First Bank & Trust Co.
Plainfield .. *
Mid-City Trust Co.
Plainfield Trust Co.
State Trust Co.
Rahway
Rahway Trust Co.
Ridgefield Park .. . Ridgefield Park Trust Co.
Rochelle Park
Rochelle Park Bank
Rutherford
Rutherford Trust Co.
South Orange
South Orange Trust Co.
Summit
Summit Trust Co.
Tenafly
Tenafly Trust Co.
Westfield
Peoples Bank & Trust Co.
Westfield Trust Co.
NEW YORK (124 banks)
Citizens & Farmers Trust Co.
First Trust Co.
State Bank of Albany
Amityville
Bank of Amityville
Amsterdam
Montgomery County Trust Co.
Arcade
Citizens Bank
Bank of Avoca
Avoca
Genesee Trust Co.
Batavia
State Bank of Belmont
Belmont
Marine Midland Trust Co.
Binghamton
Bank of Blasdell
Riasdell
Brooklyn (see New York)
Liberty Bank
Buffalo
Manufacturers & Traders Trust
Co.
Marine Trust Co.
Canandaigua . .. . Ontario County Trust Co.
Canaseragn
Canaseraga State Bank
Canisteo
First State Bank
Cattaraugus'
Bank of Cattaraugus
Center Moriches . Center Moriches Bank
Chatham
State Bank of Chatham
Chester-Schroon-Horicon Bank
Chester-town
Clymer State Bank
Clymer
Cohocton State Bank
Cohocton
De Ruyter State Bank
De Ruyter
Dunkirk Trust Co.
Dunkirk
Ellenburg Depot State Bank of Ellenburg
Chemung Canal Trust Co.
Elmira
Endicott Trust Co.
Endicott
Union Trust Co.
Peoples Bank
Evans Mills
Bank of Farmingdale
Farmingdale
Floral Park Bank & Trust Co.
Floral Park
Citizens
Trust Co.
Fredonia
Garden City Bank & Trust Co.
Garden City
Geneva
Trust
Co.
Geneva
Trust Co. of Fulton County
Gloversville
Bank
of
Great
Neck
Great Neck
Peoples Bank of Hamburgh
Hamburg
Bank
of
Hammondsport
Hammondsport . .
Bank of Hicksville
Hicksville
Adams
Albany
1
Exclusive of part of State located in another district.
110
ANNUAL REPORT OF BOARD OF GOVERNORS
DISTRICT NO. 2—Continued
NEW YORK-continued
.. Tompkins County Trust Co.
Ithaca
Jamestown .... .. Bank of Jamestown
Johnson City.. ..Workers Trust Co.
.. Northern Westchester Bank
Katonah
.. Kingston Trust Co.
Kingston
Lackawanna .. .. American Bank
Little Falls ... .. Herkimer County Trust Co.
.. Citizens Bank
Locke
.. Lewis County Trust Co.
Lowville
.. Peoples Trust Co.
Malone
Massena
ing d
..State Bank of Mayvil._
Mayville
Ma
Middletown .. . Orange County Trust Co.
Millbrook .... .Bank of Millbrook
. Nassau County Trust Co.
Mineola
Mount Kisco.. .Trust Co. of Northern Westchester
. Fleetwood Bank
Mount Vernon
Mount Vernon Trust Co.
. Amalgamated Bank
New York
Bankers Trust Co.
Bank of the Manhattan Co.
Bank of New York
Bank of Yorktown
Brooklyn Trust Co.
Central Hanover Bank & Trust
Co.
Chemical Bank & Trust Co.
City Bank-Farmers Trust Co.
Clinton Trust Co.
Colonial Trust Co.
Continental Bank & Trust Co.
Corn Exchange Bank Trust Co.
Federation Bank & Trust Co.
Fifth Avenue Bank
Fulton Trust Co.
Guaranty Trust Co.
Irving Trust Co.
Lawyers Trust Co.
Manufacturers Trust Co.
Marine Midland Trust Co.
Merchants Bank
New York Trust Co.
Pan American Trust Co.
Pennsylvania Exchange Bank
Schroder Trust Co.
Trade Bank of New York
United States Trust Co.
Niagara Falls . .Power City Trust Co.
North Collins. .Bank of North Collins
Ogdensburg
.Ogdensburg Trust Co.
Olean
.Olean Trust Co.
Oneida
, .Madison County Trust & Deposit Co.
Ontario
. State Bank of Ontario
Orchard Park .. .Bank of Orchard Park
Oriskany Falls . . First Trust & Deposit Co.
Ossining
. Ossining Trust Co.
Pearl River.... . State Bank of Pearl River
. Citizens Bank
Perry
Pleasantville ... . Mount Pleasant Bank & Trust
Co.
Port Chester.... .Mutual Trust Co. of Westchester County
.Central Trust Co.
Rochester
Lincoln-Alliance Bank & Trust
Co.
.Rome
Trust Co.
Rome
.Peconic Bank
Sag Harbor
.
Salamanca
Trust Co.
Salamanca
Saratoga Springs. . Adirondack Trust Co.
.Oystermen's
Bank & Trust Co.
Sayville
.Schenectady Trust Co.
Schenectady
.
State
Bank
of
Sea Cliff
Sea Cliff
Smithtown Branch . Bank of Smithtown
.Southampton
Bank
Southampton
. Ramapo Trust Co.
Spring Valley
. Bank of Suffolk County
Stony Brook
. First Trust & Deposit Co.
Syracuse
Syracuse Trust Co.
.Washington Irving Trust Co.
Tarrytown
.First Citizens Bank & Trust Co.
Utica
.Wyoming County Bank &
Warsaw
Trust Co.
DISTRICT NO. 2—Continued
NEW YORK—continued
Watertown ..
.Northern New York Trust Co.
Watkins Glen
.Watkins State Bank
Westbury ....
. Bank of Westbury Trust Co.
Westhampton
Beach
. Seaside Bank
West New
. West New Brighton Bank
Brighton ...
. Citizens Bank
White Plains.
County Trust Co.
DISTRICT NO. 3 (66 banks)
DELAWARE (4 banks)
Wilmington
Equitable Trust Co.
Industrial Trust Co.
Security Trust Co.
Wilmington Trust Co.
NEW JERSEY * (5 banks)
Camden
Camden Trust Co.
Hightstown
Hightstown Trust Co.
Princeton
Princeton Bank & Trust Co.
Riverside
Riverside Trust Co.
Swedesboro
Swedesboro Trust Co.
PENNSYLVANIA i (57 banks)
Allentown
Liberty Bank & Trust Co.
Bloomsburg
Bloomsburg Bank - Columbia
Trust Co.
Carlisle
Carlisle Trust Co.
Chester
Chester-Cambridge Bank &
Trust Co.
Clearfield
Clearfield Trust Co.
Danville
Montour County Trust Co.
Du Bois
Union Banking & Trust Co.
Easton
Easton Trust Co.
East Petersburg...East Petersburg State Bank
Egypt
Farmers Bank
Harrisburg
Central Trust Co.
Dauphin Deposit Trust Co.
Hazleton
Markle Banking & Trust Co.
Peoples Savings & Trust Co.
Traders Bank & Trust Co.
Honesdale
Wayne County Savings Bank
Houtzdale
Houtzdale Trust Co.
Huntingdon
Grange Trust Co.
Jenkintown
Jenkintown Bank & Trust Co.
Lancaster
Farmers Bank & Trust Co.
Northern Bank & Trust Co.
Lemoyne
Lemoyne Trust Co.
Lewistown
Lewistown Trust Co.
Littlestown
Littlestown State Bank
Lock Haven
Lock Haven Trust Co.
Lykens
Miners Bank & Trust Co.
Mahanoy City
Merchants Banking Trust Co.
Middletown
Citizens Bank & Trust Co.
Mount Carmel
Liberty State Bank & Trust
Co.
Myerstown
Myerstown Trust Co.
Nanticoke
Peoples Bank
New Oxford
Farmers & Merchants Bank
Norristown
Montgomery Trust Co.
Norristown-Penn Trust Co.
Orrstown
Orrstown Bank
Paoli
Paoli Bank & Trust Co.
Philadelphia
Fidelity-Philadelphia Trust Co.
First Trust Company
Gimbel Bros. Bank & Trust Co.
Girard Trust Co.
Integrity Trust Co.
Ninth Bank & Trust Co.
Pennsylvania Co. for Insurances on Lives and Granting
Annuities
Provident Trust Co.
Prospect Park
Interboro Bank & Trust Co.
Quakertown
Quakertown Trust Co.
Re'ading
Reading Trust Co.
Schnecksville
Schnecksville State Bank
Schuylkill Haven.. Schuylkill Haven Trust Co.
Steelton
Steelton Bank & Trust Co.
Tamaqua
Peoples Trust Co.
Temple
Temple State Bank
1
Exclusive of part of State located in another district.
FEDERAL RESERVE SYSTEM
DISTRICT NO. 3—Continued
PENNSYLVANIA—continued
Wilkes-Barre
Wilkes-Barre Deposit & Savings Bank
Williamsport
West Branch Bank & Trust
Co.
Wyomissing
Peoples Trust Co.
York
Guardian Trust Co.
York Trust Co.
DISTRICT NO. 4 (114 banks)
K E N T U C K Y 1 (6 banks)
Covington
Peoples-Liberty Bank & Trust
Co.
Lexington
Bank of Commerce
Security Trust Co.
Paris
Bourbon-Agricultural Bank &
Trust Co.
Peoples Deposit Bank & Trust
Co.
Richmond
State Bank & Trust Co.
OHIO (81 banks)
Akron
Firestone Park Trust & Savings Bank
First-Central Trust Co.
Apple Creek
Apple Creek Banking Co.
Archbold
Peoples State Bank Co.
Ashland
Ashland Bank & Savings Co.
Bellevue
Union Bank & Savings Co.
Bellville
Farmers Bank
Brecksville
Brecksville Bank
Canal Winchester.. Peoples Bank Co.
Canton
Geo. D. Harter Bank
Castalia
Castalia Banking Co.
Celina
Commercial Bank Co.
Christiansburg
Farmers & Merchants Bank
Co.
Cincinnati
Central Trust Co.
Fifth-Third Union Trust Co.
Peoples Bank & Savings Co.
Provident Savings Bank &
Trust Co.
Southern Ohio Savings Bank
& Trust Co.
Western Bank & Trust Co.
Cleveland
Cleveland Trust Co.
Lorain Street Bank
Union Bank of Commerce Co.
Columbiana
Union Banking Co.
Columbus
Fifth Avenue Savings Bank Co.
Conneaut
,. Citizens Banking & Savings Co.
Conneaut Banking & Trust Co.
Cortland
Cortland Savings & Banking
Co.
Coshocton
Peoples Bank & Trust Co.
Danville
Commercial & Savings Bank
Co.
Delphos
Commercial Bank
Peoples Bank
Delta
Peoples Savings Bank Co.
East Liverpool.... Potters Bank & Trust Co.
Elyria
Elyria Savings & Trust Co.
1
Savings Deposit Bank & Trust
Co.
Fayette
Fayette State Savings Bank
Co.
Findlay
Ohio Bank & Savings Co.
Geneva
Geneva Savings & Trust Co.
Gibsonburg
Home Banking Co.
Hillsboro
Hillsboro Bank & Savings Co.
Hubbard
Hubbard Banking Co.
Leesburg
Citizens Bank & Savings Co.
Lyons
Farmers State Bank
Madison
Citizens Bank
Mansfield
Farmers Savings & Trust Co.
Marengo
Marengo Banking Co.
Martins Ferry . . . . Peoples Savings Bank Co.
Mason
First-Mason Bank
Massillon
Ohio-Merchants Trust Co.
Middletown
. . . . First American Bank & Trust
Co.
Minster
Minster State Bank
Mount Blanchard. Citizens Bank
Mount Vernon
Knbx County Savings Bank
Napoleon
Community Bank
111
DISTRICT NO. 4—-Continued
KENTUCKY—continued
Newark
Licking County Bank
Newark Trust Co.
New Lexington.... Perry County Bank
New Philadelphia. Ohio Savings & Trust Co.
Norwalk
Huron County Banking Co.
Norwood
Norwood-Hyde Park Bank &
Trust Co.
Oak Harbor
Oak Harbor State Bank Co.
Oberlin
Oberlin Savings Bank Co.
Orrville
Orrville Savings Bank
Pomeroy
Farmers Bank & Savings Co.
Rittman
Rittman Savings Bank
Russellville
Rank of Russellville Co.
St. Marys
Home Banking Co.
Sandusky
Western Security Bank
Shelby '.
Citizens Bank
Shiloh
Shiloh Savings Bank Co.
Toledo
Commerce Guardian Bank
Morris Plan Bank
Ohio Citizens Trust Co.
Toledo Trust Co.
Utica
Utica Savings Bank Co.
Van Wert
Peoples Savings Bank
Wakeman
Wakeman Bank Co.
Wellington
First Wellington Bank
Wooster
Commercial Banking & Trust
Co.
Yellow Springs... .Miami Deposit Bank
Youngstown
Dollar Savings & Trust Co.
PENNSYLVANIA i (23 banks)
Aliquippa
Woodlawn Trust Co.
Ambridge
Economy Bank
Beaver
Beaver Trust Co.
Dormont
Dormont Savings & Trust Co.
Erie
Security-Peoples Trust Co.
Homestead
Monongahela Trust Co.
McKeesport
Peoples City Bank
Meadville
Crawford County Trust Co.
New Brighton
Beaver County Trust Co.
New Castle
Lawrence Savings & Trust Co.
Paint Borough
(Scalp Level
P. O.)
Merchants & Miners Bank
Pittsburgh
Allegheny Trust Co.
Allegheny Valley Bank
Colonial Trust Co.
Commonwealth Trust Co.
Homewood Bank
Peoples-Pittsburgh Trust Co.
Potter Title & Trust Co.
Union Trust Co.
Somerset
Somerset Trust Co.
Turtle Creek
Turtle Creek Bank & Trust Co.
Warren
Warren Bank & Trust Co.
Windber
Windber Trust Co.
WEST VIRGINIA i (4 banks)
Sistersville
First-Tyler Bank & Trust Co.
Wheeling
Citizens Mutual Trust Co.
Security Trust Co.
Wheeling Dollar Savings &
Trust Co.
DISTRICT NO. 5 (69 banks)
DISTRICT OF COLUMBIA (4 banks)
Washington
American Security & Trust Co.
National Savings & Trust Co.
Union Trust Co.
Washington Loan & Trust Co.
MARYLAND (11 banks)
Baltimore
Baltimore Commercial Bank
Calvert Bank
Commonwealth Bank
Fidelity Trust Co.
Maryland Trust Co.
Union Trust Co. of Maryland
Cambridge
County Trust Co. of Maryland
Ellicott City
Commercial & Farmers Bank
Forest Hill
Forest Hill State Bank
Hagerstown
Hagerstown Trust Co.
Salisbury
Farmers & Merchants Bank
1
Exclusive of part of State located in another district.
112
ANNUAL REPORT OF BOARD OF GOVERNORS
DISTRICT NO. 5—Continued
NORTH CAROLINA (9 banks)
Charlotte
American Trust Co.
Concord
Citizens Bank & Trust Co.
Edenton
Bank of Edenton
Marshall
Citizens Bank
Tryon
Tryon Bank & Trust Co.
Washington
Bank of Washington
Wilmington
Peoples Savings Bank <fe Trust
Co.
Wilmington Savings & Trust
Co.
Winston-Salem ... Wachovia Bank & Trust Co.
SOUTH CAROLINA (4 banks)
Bishopville
Peoples Bank
Charleston
Carolina Savings Bank
Chester
Commercial Bank
Hartsville
Bank of Hartsville
VIRGINIA (26 banks)
Abingdon
Farmers Exchange Bank
Amelia
Union Bank & Trust Co.
Blackstone
Citizens Bank & Trust Co.
Chase City
Peoples Bank & Trust Co.
Farmville
Planters Bank & Trust Co.
Front Royal
Bank of Warren
Glade Spring
Bank of Glade Spring
Halifax
Bank of Halifax
Kenbridge
Bank of Lunenburg
Lacrosse
Bank of Lacrosse
Lawrenceville
Farmers & Merchants Bank
Lynchburgj
Lynchburg Trust & Savings
Bank
Montross
Peoples Bank
Petersburg
Petersburg Savings & American Trust Co.
Powhatan
Bank of Powhatan
Richmond
Bank of Commerce & Trusts
Mechanics & Merchants Bank
State-Planters Bank & Trust
Co.
Rural Retreat
Peoples Bank
Smithfield
Merchants & Farmers Bank,
Inc.
South Hill
Citizens Bank, Inc.
Suffolk
American Bank & Trust Co.
Farmers Bank of Nansemond
Tazewell
Farmers Bank of Clinch Valley
Williamsburg
Peninsula Bank & Trust Co.
Winchester
Union Bank
WEST VIRGINIA i (15 banks)
Berwind ...."
Berwind Bank
Buffalo
Buffalo Bank
Charleston
Kanawha Banking & Trust Co.
Kanawha Valley Bank
Hurricane
Putnam County Bank
Lewisburg
Greenbrier Valley Bank
Martinsburg
Peoples Trust Co.
Parsons
Tucker County Bank
Petersburg
Potomac Valley Bank
Rainelle
Bank of Rainelle
Romney
Bank of Romney
St. Albans
Bank of St. Albans
St. Marys
Pleasants County Bank
Spencer
Traders Trust & Banking Co.
Summersville
Farmers & Merchants Bank
DISTRICT NO. 6 (52 banks)
ALABAMA (16 banks)
Aliceyille
Aliceyille Bank & Trust Co.
Birmingham
Birmingham Trust & Savings
Co.
Clanton
Peoples Savings Bank
Clayton
Bank of Commerce
Columbiana
Columbiana Savings Bank
Cullman
Parker Bank & Trust Co.
Dothan
Dothan Bank & Trust Co.
Eutaw
Merchants & Farmers Bank of
Greene County
Guin
Marion County Banking Co.
Marion Junction... Marion Junction State Bank
Oneonta
Citizens Bank
Pine Apple
Bank of Pine Apple
DISTRICT NO. 6—Continued
ALABAMA—continued
Selma
Peoples Bank & Trust Co.
Thomaston
Planters Bank & Trust Co.
Winfield
Winfield State Bank
York
Bank of York
FLORIDA (4 banks)
Fort Lauderdale... Broward Bank & Trust Co.
Marianna
Citizens State Bank
Ocala
Commercial Bank & Trust Co.
St. Petersburg.... Union Trust Co.
GEORGIA (20 banks)
Adairsville
Bank of Adairsville
Atlanta
Trust Co. of Georgia
Augusta
Georgia Railroad Bank &
Trust Co.
Bainbridge
Citizens Bank & Trust Co.
Blackshear
Blackshear Bank
Brunswick
Brunswick Bank & Trust Co.
Canton
Bank of Canton
Columbus
Columbus Bank & Trust Co.
Merchants & Mechanics Bank
Commerce
Northeastern Banking Co.
Lawrenceville
Brand Banking Co.
Lincolnton
Farmers State Bank
Millen
Bank of Millen
Monroe
Farmers Bank
Pelham
Farmers Bank
Savannah
Citizens Bank & Trust Co.
Savannah Bank & Trust Co.
Soperton
Bank of Soperton
Swainsboro
Central Bank
Tifton
Bank of Tifton
LOUISIANA 1 (5 banks)
Alexandria
Rapides Bank & Trust Co.
Lake Charles
Lake Charles Bank & Trust Co.
New Orleans
American Bank & Trust Co.
Louisiana Savings Bank &
Trust Co.
Slidell
Bank of Slidell
MISSISSIPPI 1 (1 bank)
Forest
Bank of Forest
TENNESSEE (6 banks)
Carthage
Citizens Bank & Trust Co.
Chattanooga
American Trust & Banking Co.
Greeneville
Greene County Bank
Hartsville
Bank of Hartsville
Knoxville
Commercial Bank & Trust Co.
Nashville
Commerce Union Bank
DISTRICT NO. 7 (253 banks)
ILLINOIS i (62 banks)
Argenta
Gerber State Bank
Bloomington
Corn Belt Bank
Peoples Bank
Blue Island
State Bank of Blue Island
Bushnell
Farmers & Merchants State
Bank
Byron
Rock River Community Bank
Chicago
Amalgamated Trust & Savings Bank
Drexel State Bank
Hamilton State Bank
Harris Trust & Savings Bank
Kaspar-American State Bank
Lake Shore Trust & Savings
Bank
Lake View Trust & Savings
Bank
Main State Bank
Mercantile Trust & Savings
Bank
Metropolitan State Bank
Metropolitan Trust Co.
Northern Trust Co.
Chicago
Personal Loan & Savings Bank
Sears-Community State Bank
State Bank of Clearing
Uptown State Bank
Cowden
State Bank of Cowden
1
Exclusive of part of State located in another district.
FEDERAL RESERVE SYSTEM
DISTRICT NO. 7—Continued
ILLINOIS—continued
Kane County Bank & Trust
Elburn
Co.
State Bank of Eureka
Eureka ..
Evanston
Trust & Savings
Evanston
Bank
State Bank & Trust Co.
Fairbury
Fairbury State Bank
Free port
State Bank of Freeport
Fulton
Fulton State Bank
Galesburg ...
Farmers & Mechanics Bank
Geneva
State Bank of Geneva
Joy
Joy State Bank
Kankakee ...
City Trust & Savings Bank
Kewanee
Peoples State Savings Bank
Lostant
Farmers State Bank
Mattoon
Central Illinois Trust & Savings Bank
McHenry ...
West McHenry State Bank
Metamora State Bank
Metamora ..
Citizens State Bank
Milford
Parish Bank & Trust Co.
Momence . .
Smith Trust & Savings Bank
Morrison ...
State Bank of Niantic
Niantic
Niles Center State Bank
Niles Center
Oak Park Trust & Savings
Oak Park ..
Bank
Petersburg . .
Schirding State Bank
Riverdale ...
First Trust & Savings Bank
Rochester ...
Rochester State Bank
Rushville . ..
Rushville State Bank
Shannon
First State Bank
Shelby County State Bank
Shelbyville .
Springfield Marine Bank
Springfield ..
Thomson State Bank
Thomson ...
Bank of Tolono
Tolono
Citizens Bank
Tuscola
Tuscola State Bank
Walnut
Citizens State Bank
Washington
Danforth Banking Co.
Wenona
First State Bank
Wheaton
Gary-Wheaton Bank
Wheaton Trust & Savings
Bank
Wilmette State Bank
Wilmette
INDIANA (18 banks)
Auburn
Auburn State Bank
Columbia City ... Citizens State Bank
Connersville
Fayette Bank & Trust Co.
Darlington
Farmers & Merchants State
Bank
Elkhart
St. Joseph Valley Bank
Greencastle
First-Citizens Bank & Trust
Co.
Hartford City
Citizens State Bank
Hebron
Citizens Bank
Indianapolis
Fletcher Trust Co.
Jamestown
Citizens State Bank
Kokomo
Union Bank & Trust Co.
Mohawk
Mohawk State Bank
Monticello
State & Savings Bank
Muncie
Merchants Trust & SavingsCo.
Poland
Poland-State Bank
South Bend
First Bank & Trust Co.
Tipton
Farmers Loan & Trust Co.
Valparaiso
First State Bank
IOWA (33 banks)
Algona*
Iowa State Bank
Security State Bank
Avoca
Avoca State Bank
Blencoe
Blencoe State Bank
Cedar Falls
Union Bank & Trust Co.
Cherokee
Cherokee State Bank
Churdan
First State Bank
Davenport
Davenport Bank & Trust Co.
Des Moines
Bankers Trust Co.
Fairneld
Towa State Bank & Trust Co.
Fontanelle
State Savings Bank
Fort Dodge
The State Bank
Fort Madison . . . . Fort Madison Savings Bank
Glenwood
Glenwood State Bank
Holstein
Holstein State Bank
Ida Grove
Ida County State Bank
113
DISTRICT NO. 7-—Continued
IOWA—continued
Lineville
Lineville State Bank
Maquoketa
Jackson State Savings Bank
Mason City
United Home Bank & Trust
Monticello
Moorhead
M11scatine
Monticello State Bank
Moorhead State Hank
Central State Bank
Muscat inn Bank & Trust Co.
Newton
Jasper County Savings Bank
Osage
Home Trust & Savings Bank
Ottumwa
Union Bank & Trust Co.
Riceville
Riceville State Bank
Royal
Home State Bank
Shenandoah
Security Trust & Savings Bank
Storm Lake
Security Trust & Savings Bank
Templeton
Templeton Savings Bank
Washington
Washington State Bank
Williams
Williams Savings Bank
MICHIGAN i (116 banks)
Adrian
Adrian State Savings Bank
Commercial Savings Bank
Lenawee County Savings Bank
Albion
Commercial & Savings Bank
Algonac
Algonac Savings Bank
Alpena
Alpena Savings Bank
Alto
Farmers State Bank
Ann Arbor
Ann Arbor Savings & Commercial Bank
State Savings Bank
,.
Armada
State Bank
Armada
,. Bay City Bank
Bay City
Peoples Commercial & Savings
Bank
..Peoples State Bank
Belleville
Berrien Springs . Berrien Springs State Bank
. Big Rapids Savings Bank
Big Rapids
Blanchard State Bank
Blanchard
.....Blissfield State Bank
Blissfield
Peoples State Bank
Bronson
Brown City Savings Bank
Brown City
Capac State Savings Bank
Capac
Cass City State Bank
Cass City
Pinney State Bank
Cass County State Bank
Cassopolis
Charlevoix County State Bank
Charlevoix
Eaton County Savings Bank
Charlotte
Chelsea State Bank
Chelsea
Chesaning State Bank
Chesaning
Clarkston State Bank
Oarkston
State Bank of Coloma
Coloma
Coopersville State Bank
Coopersville
Old Corunna State Bank
Corunna
State Bank of Croswell
Croswell
Davison State Bank
Davison
Detroit Bank
Detroit
Industrial Morris Plan Bank
United Savings Bank
Monroe County Bank
Dundee
Ecorse Savings Bank
Ecorse
Farmington State Bank
Farmington
Old State Bank
Fennville
State Savings Bank
Fenton
Citizens Commercial & SavFlint
ings Bank
Genesee County Savings Bank
Fountain State Bank
Fountain
Frankenmuth State Bank
Frankenmuth
Fremont State Bank
Fremont
Old State Bank
.. State Savings Bank
Gagetown
.. Grand Haven State Bank
Grand Haven
Peoples Savings Bank
Grand Rapids ..Old Kent Bank
..Community State Bank
Grandville
..Commercial State Savings
Greenville
Bank
First State Bank of Greenville
Grosse
Pointe Bank
Grosse Pointe ..
Emmet County State Bank
Harbor Springs
Hillsdale
State Savings Bank
Hillsdale
Holland State Bank
Holland
Peoples State Bank
Holly
First State & Savings Bank
Howell
First State & Savings Bank
1
Exclusive of part of State located in another district
114
ANNUAL REPORT OF BOARD OF GOVERNORS
DISTRICT NO. 7—Continued
MICHIGAN—continued
Imlay City
Imlay City State Bank
Jackson
Jackson City Bank & Trust
Co.
Jonesville
Grosvenor Savings Bank
Kingston
Kingston State Bank
Lakeyiew
Bank of Lakeview
Lansing
American State Savings Bank
Bank of Lansing
Lapeer
Lapeer Savings Bank
Lawrence
Home State Bank
Lowell
State Savings Bank
Manchester
Peoples Bank
Union. Savings Bank
Manistee
Manistee County Savings
Bank
Marcellus
G. W. Jones Exchange Bank
Marshall
Commercial Savings Bank
Mason
Farmers Bank
Midland
Chemical State Savings Bank
Milan
Peoples State Bank
Milford
Oakland County State Bank
Monroe
Dansard State Bank
Montague
Farmers State Bank
Mount Clemens .. Mount Clemens Savings Bank
Mount Pleasant .. Exchange Savings Bank
Isabella County State Bank
New Baltimore ... Citizens State Savings Bank
New Haven
New Haven Savings Bank
North Branch
Pioneer Bank
Onsted
Onsted State Bank
Oxford
Oxford Savings Bank
Petoskey
First State Bank
Pigeon
Pigeon State Bank
Pinconning
Pinconning State Bank
Richmond
Macomb County Savings Bank
Romeo
Romeo Savings Bank
Royal Oak
Guardian Bank
Saginaw
Saginaw State Bank
St. Charles
St. Charles State Bank
St. Glair
Commercial & Savings Bank
St. Johns
State Bank of St. Johns
Saugatuck
Fruit Growers State Bank
Sebewaing
Farmers & Merchants State
Bank
South Haven
Citizens State Bank
First State Bank
Sparta
Sparta State Bank
Spring Lake
Spring Lake State Bank
Springport
Springport State Savings Bank
Traverse City
Traverse City State Bank
Trenton
Trenton State Bank
Vassar
State Bank of Vassar
Wayne
Wayne State Bank
Whitehall
State Bank of Whitehall
Williamston
Peoples State Bank
Wyandotte
Wyandotte Savings Bank
Yale
Yale State Bank
Zeeland
Zeeland State Bank
WISCONSIN i (24 banks)
Antigo
Fidelity Savings Bank
Burlington
Bank of Burlington
Chilton
Commercial Bank
Edgerton
Tobacco Exchange Bank
Green Bay
Peoples Trust & Savings Bank
Green Lake
Green Lake State Bank
Kaukauna
Bank of Kaukauna
Manitowac
Manitowoc Savings Bank
Markesan
Markesan State Bank
Mayville
State Bank of Mayville
Milwaukee
American State Bank
Marshall & Ilsley Bank
West Side Bank
Platteville
State Bank of Platteville
Sauk City
Farmers & Citizens Bank
Sheboygan
Bank of Sheboygan
Citizens State Bank
South Milwaukee.. Home State Bank
Sturgeon Bay
Bank of Sturgeon Bay
Viroqua
State Bank of Viroqua
Waupaca
Farmers State Bank
Waupun
State Bank of Waupun
Wausau
Citizens State Bank
Whitewater
First Citizens State Bank
DISTRICT NO. 8 (77 banks)
ARKANSAS (7 banks)
Batesville
Citizens Bank & Trust Co.
Blytheville
Farmers Bank & Trust Co.
Fordyce
Fordyce Bank & Trust Co.
Little Rock
W. B. Worthen Co.
Russellville
Bank of Russellville
Peoples Exchange Bank
Waldron
Bank of Waldron
ILLINOIS i (17 banks)'
Breese
State Bank of Breese
Chester
First State Bank
Columbia
Monroe County Savings Bank
& Trust Co.
East St. Louis.... Union Trust Co.
Edwardsville
Bank of Edwardsville
Emngham
Effingham State Bank
Eldorado
C. P. Burnett & Sons, Bankers
Greenville
State Bank of Hoiles & Sons
Highland
State & Trust Bank
Hillsboro
Montgomery County Loan &
Trust Co.
Hoyleton
Hoyleton State & Savings
Bank
Jacksonville
Elliott State Bank
Johnston City ... Johnston City State Bank
Litchfield
Litchfield Bank & Trust Co.
OTallon
First State Bank
Rich view
Rich view State Bank
Steelevillle
State Bank of Steeleville
KENTUCKY i (7 banks)
Danville
Boyle Bank & Trust Co.
Hartford
Citizens Bank
Hopkinsville
Planters Bank & Trust Co.
Louisville
Kentucky Title Trust Co.
Lincoln Bank & Trust Co.
Louisville Trust Co.
Owensboro
First - Owensboro B a n k &
Trust Co.
MISSISSIPPI1 (1 bank)
Peoples Bank
Indianola
MISSOURI1 (45 banks)
Camdenton
Camden County Bank
Carrollton
Carroll County Trust Co.
Clayton
St. Louis County Bank
Clinton
Union State Bank
Farmington
United Bank
Fulton
Callaway Bank
Glasgow
Glasgow Savings Bank
Hannibal
Farmers & Merchants Bank
& Trust Co.
Lancaster
Schuyler County State Bank
Lebanon
State Savings Bank
Luxemburg (St.
Louis P. O.)....Lemay Ferry Bank
Maplewood
Peoples State Bank
Marshall
Wood & Huston Bank
Memphis
Bank of Memphis
Moberly
City Bank & Trust Co.
Mechanics Bank & Trust Co.
Monroe City
Monroe City Bank
Normandy
Normandy State Bank
Pine Lawn
Pine Lawn Bank
St. Louis
Baden Bank
Bremen Bank & Trust Co.
Cass Bank & Trust Co.
Chippewa Trust Co.
Easton-Taylor Trust C«.
Jefferson Bank & Trust Co.
Jefferson-Gravois Bank
Lindell Trust Co.
Manchester Bank
Manufacturers Bank & Trust
Co.
Mercantile-Commerce Bank &
Trust Co.
Mississippi Valley Trust Co.
Mound City Trust Co.
North St. Louis Trust Co.
Northwestern Trust Co.
Plaza Bank
Southern Commercial & Savings Bank
1
Exclusive of part of State located in another district.
FEDERAL RESERVE SYSTEM
DISTRICT NO. 8—Continued
MISSOURI—continued
St. Louis
Southwest Bank
Tower Grove Bank & Trust
Co.
United Bank & Trust Co.
St. Louis County. Gravois Bank
Sedalia
Sedalia Bank & Trust Co.
Vandalia
Vandalia State Bank
Versailles
Bank of Versailles
Washington
Franklin County Bank
Webster Groves... Webster Groves Trust Co.
DISTRICT NO. 9 (71 banks)
MICHIGAN 1 (9 banks)
Escanaba
State Savings Bank
Ewen
State Bank of Ewen
Gladstone
Gladstone State Savings Bank
Iron Mountain .. Commercial Bank
Iron River
Miners' State Bank
L'Anse
Commercial Bank
Menominee
Commercial Bank
Sault Ste. Marie.. Central Savings Bank
Sault Savings Bank
MINNESOTA (13 banks)
... State Bank of Aurora
Aurora . ..
... Sprague State Bank
Caledonia .
... Security State Bank
Cannon Fa
... Root River State Bank
Chatiield .
. . . Clinton State Bank
Clinton ...
... Security State Bank
Houston ..
... Security Bank & Trust Co.
Owatonna
... Peoples State Bank
Plainview
... First State Bank
Rushmore
... Zapp State Bank
St. Cloud
... Farmers & Merchants State
Springfield
Bank
State Bank of Springfield
...
Wadena
County State Bank
Wadena
MONTANA (24 banks)
Daly Bank & Trust Co.
Anaconda
Belt Valley Bank
Belt
Citizens Bank & Trust Co.
Big Timber
Security Trust & Savings
Billings
Bank
Gallatin Trust & Savings Bank
Bozeman ..
Security Bank & Trust Co.
Metals Bank & Trust Co.
Butte . . . .
Stockmens Bank
Cascade ..
Citizens State Bank
Choteau ..
Yellowstone Bank
Columbus
Deer Lodge
Deer Lodge Bank & Trust Co.
Dent on ...
Farmers State Bank
Fromberg .
Clarks Fork Valley Bank
Glasgow ..
Farmers-Stockgrowers Bank
Great Falls
Montana Bank & Trust Co.
Helena . . . .
, Union Bank & Trust Co.
Laurel . . . .
Yellowstone Bank
Libby
First State Bank
Richey ...
First State Bank
Ronan . . . .
Ronan State Bank
Terry
State Bank of Terry
State Bank of Townsend
Townsend
Farmers State Bank
Victor . . . .
Worden ...
Farmers State Bank
SOUTH DAKOTA (21 banks)
Alcester
State Bank of Alcester
Alpena
Bank of Alpena
Arlington
Citizens State Bank
Belle Fourche
Bank of Belle Fourche
Belvidere
Belvidere State Bank
Buffalo
First State Bank
Burke
Burke State Bank
Faith
Farmers State Bank
Flandreau
Farmers State Bank
Freeman
Merchants State Bank
Fulton
Fulton State Bank
Huron
Farmers & Merchants Bank
Madison
Security Bank & Trust Co.
Mclntosh
Security State Bank
Miller
Hand County State Bank
Mitchell
Commercial Trust & Savings
Bank
DISTRICT NO. 9—Continued
SOUTH DAKOTA—continued
Mobridge
Citizens Bank
Presho
Farmers & Merchants State
Bank
Sturgis
Bear Butte Valley Bank
Toronto
Bank of Toronto
Woonsocket
Sanborn County Bank
WISCONSIN 1 (4 banks)
Boyceville
Bank of Boyceville
Glenwood C i t y . . . . First State Bank
Rhinelander
Merchants State Bank
Tomahawk
Bradley Bank
DISTRICT NO. 10 (70 banks)
COLORADO (11 banks)
Brighton
Brighton State Bank
Del Norte
Rio Grande County Bank
Delta
Colorado Bank &• Trust Co.
Denver
Central Savings Bank & Trust
Co.
International Trust Co.
Eaton
Eaton Bank
Fort Morgan
Farmers State Bank
Haxtun
Haxtun State Bank
La Junta
Colorado Savings & Trust Co.
Sterling
Commercial Savings Bank
Yuma
Farmers State Bank
Abilene
Great Bend
Hiawatha
Hutchinson
Kansas City
Liberal
Luray
Ness City
Oakley
Osage City
Pratt
Sedan
St. Marys
Sylvan Grove
Tonganoxie
Topeka
Waken eld
Winfield
KANSAS (18 banks)
Citizens Bank
American State Bank
Morrill & Janes Bank
Hutchinson State Bank
Riverview State Bank
Citizens- State Bank
Peoples Statei Bank
First State Bank
Farmers State Bank
Citizens State Bank
Peoples Bank
Sedan State Bank
St. Marys State Bank
Sylvan State Bank
First State Bank
Fidelity Savings State Bank
Farmers & Merchants State
Bank
The State Bank
MISSOURI 1 (10 banks)
Gentry County Bank
Bank of Cathage
Bank of Craig
Commerce Trust Co.
Merchants Bank
King City
First State Bank
Lamar
Barton County State Bank
Rich Hill
Security Bank
St. Joseph
Empire Trust Co.
South St. Joseph.. First St. Joseph Stock Yards
Bank
Albany
Carthage
Craig
Kansas City
NEBRASKA (14 banks)
Alma
Harlan County Bank
Bancroft
Citizens Bank
Blair
Washington County Bank
Chappell
Deuel County State Bank
Hartington
Bank of Hartington
Lexington
Farmers State Bank
North Platte
McDonald State Bank
Pawnee City
Citizens State Bank
Rushville
Union State Bank
Scribner
Farmers State Bank
Stromsburg
Stromsburg Bank
Valley
Bank of Valley
Wahoo
Wahoo State 1Bank
Wallace
Farmers State Bank
Aztec
Taos
1
Exclusive of part of State located in another district.
115
NEW MEXICO i (2 banks)
Citizens Bank
First State Bank
116
ANNUAL REPORT OF BOARD OF GOVERNORS
DISTRICT NO. 10—Continued
OKLAHOMA i (6 banks)
Ada
Oklahoma State Bank
Garber
Bank of Garber
Okarche
First Bank of Okarche
Purcell
First State Bank
Stroud
First State Bank
Woodward
Bank of Woodward
WYOMING (9 banks)
Evanston
Stockgrowers Bank
Lusk
Lusk State Bank
Mountain View
Uinta County State Bank
Newcastle
First State Bank
Saratoga
Saratoga State Bank
Sundance
Sundance State Bank
Wheatland
State Bank of Wheatland
Stock Growers Bank
Worland
Farmers State Bank
DISTRICT NO. 11 (59 banks)
ARIZONA^ (1 bank)
Tucson
Southern Arizona Bank &
Trust Co.
LOUISIANA1 (2 banks)
Minden
Minden Bank & Trust Co.
Shreveport
Continental-American Bank &
Trust Co.
NEW MEXICO i (3 banks)
Carlsbad
American Bank
Deming
Mimbres Valley Bank
Logan
McFarland Bros. Bank
OKLAHOMA i (1 bank)
Atoka
Atoka State Bank
TEXAS (52 banks)
Bay City
Bay City Bank & Trust Co.
Beaumont
Security State Bank & Trust
Co.
Beeville
State Bank & Trust Co.
Bremond
First State Bank
Brownfield
Brownfield State Bank
Bryan
First State Bank & Trust Co.
Celina
First State Bank
Clarendon
Farmers State Bank
Clifton
Farmers State Bank
Dalhart
Citizens State Bank
De Kalb
State Bank of De Kalb
Del Rio
Del Rio Bank & Trust Co.
Dodsonville
(P. O.) Dodson)..First State Bank
East Bernard
Union State Bank
Eden
Eden State Bank
Ferris!
Farmers & Merchants State
Bank
Forney
Forney State Bank
Franklin
First State Bank
Gatesville
Guaranty Bank & Trust Co.
Gonzales
Gonzales State Bank
Goose Creek
Citizens State Bank & Trust
Co.
Hamilton
Hamilton Bank & Trust Co.
Houston
Citizens State Bank
lola
Iola State Bank
Kirkland
First State Bank
Kosse
First State Bank
Ladonia
Farmers & Merchants State
Bank
Llano
Moore State Bank
Loraine
First State Bank
Madisonville
Farmers State Bank
Matador
First State Bank
Mathis
First State Bank
Maypearl
First State Bank
McAllen
City State Bank & Trust Co.
Mount Pleasant... Guaranty Bond State Bank
Pearsall
Security State Bank
Rails
Security State Bank & Trust
Co.
Richardson
Citizens State Bank
Roscoe
Roscoe State Bank
Rusk
Farmers & Merchants State
Bank & Trust Co.
DISTRICT NO. 11—Continued
TEXAS—continued
Shamrock
Farmers & Merchants State
Bank
Shiro
Farmers State Bank
Silsbee
Silsbee State Bank
Sinton
Commercial State Bank
Spearman
First State Bank
Thorndale
Thorndale State Bank
Tomball
Guaranty Bond State Bank
Turkey
Farmers & Merchants State
Bank
Wellington
Wellington State Bank
Wharton
Security Bank & Trust Co.
Wharton Bank & Trust Co.
Winters
Winters State Bank
DISTRICT NO. 12 (68 banks)
ARIZONA1 (1 bank)
Buckeye
Buckeye Valley Bank
CALIFORNIA (15 banks)
Carmel
Bank of Carmel
Fairfield
Solano County Bank
Long Beach
Farmers & Merchants Bank
Los Angeles
California Bank
California Trust Co.
Union Bank & Trust Co.
Newman
Bank of Newman
Oakland
Bank of Commerce
Pasadena
Citizens Commercial Trust &
Savings Bank
First Trust & Savings Bank
Salinas
Monterey County Trust &
Savings Bank
San Francisco
American Trust Co.
Wells Fargo Bank & Union
Trust Co.
San Rafael
Bank of San Rafael
Santa Paula
Citizens State Bank
IDAHO (10 banks)
Aberdeen
Bank of Aberdeen
Arco
Butte County Bank
Boise
First Security Bank of Idaho
Hazelton
Hazelton State Bank
Kellogg
First State Bank
Malad City
J. N. Ireland & Co., Bankers
Orofino
Bank of Orofino
Richfield
First State Bank
Soda Springs
Largilliere Co., Bankers
Twin Falls
Twin Falls Bank & Trust Co.
OREGON (7 banks)
Albany
Bank of Albany
Beaverton
First Security Bank
Dallas
Dallas City Bank
Gold Beach
Curry County Bank
Halsey
Halsey State Bank
Myrtle Point
Security Bank
Oakland
E. G. Young & Co. Bank
UTAH (20 banks)
Brigham
State Security Bank
Cedar City
Bank of Southern Utah
Ephraim
Bank of Ephraim
Gunnison
Gunnison Valley Bank
Helper
Helper State Bank
Kaysville
Barnes Banking Co.
Logan
Cache Valley Banking Co.
Nephi
Commercial Bank
Ogden
Commercial Security Bank
Price
Carbon Emery Bank
Provo
Farmers & Merchants Bank
Salina
First State Bank
Salt Lake City
Tracy Loan & Trust Co.
Utah Savings & Trust Co.
Walker Bank & Trust Co.
Spanish Fork
Bank of Spanish Fork
Commercial Bank
Springville
Springville Banking Co.
Vernal
Bank of Vernal
Uintah State Bank
Exclusive of part of State located in another district.
11?
FEDERAL RESERVE SYSTEM
DISTRICT NO. 12—Continued
WASHINGTON (15 banks)
. Almira State Bank
Almira
. Cashmere Valley Bank
Cashmere
Security State Bank
Coulee City
. Cowliti Valley Bank
Kelso
. First State Bank
Lacrosse ...
. Pomeroy State Bank
Pomeroy
. Pullman State Bank
Pullman,
. Citizens State Bank
Puyallup
DISTRICT NO. 12—Continued
WASHINGTON—continued
Ritzville
Rit zville State Bank
Rockford
Farmers & Merchants Bank
Seattle
Seattle Trust & Savings Bank
Selah
Selah State Bank
Spokane
Washington Trust Co.
Uniontown
Farmerss Slate Bank
Wilbur
State Bank of Wilbur
DESCRIPTION OF FEDERAL RESERVE DISTRICTS
Land area Population
(square
July 1, 1937
miles)
(estimated)
Federal Reserve district
No. 1—Boston
No. 2—New York
No. 3—Philadelphia...
No. 4—Cleveland
No. 5—Richmond
No. 6—Atlanta
No. 7—Chicago
No. 8—St. Louis
No. 9—Minneapolis...
No. 10—Kansas City.,
No. 11—Dallas
No. 12—San Francisco
Total
61,345
51,886
36,846
73,424
152,316
248,226
190,513
194,810
414,004
480,438
386,116
683,852
8,178,000
16,756,000
8,009,000
11,737,000
12,028,000
12,085,000
18,863,000
10,413,000
5,452,000
8,155,000
7,337,000
10,244,000
2,973,776
129,257,000
61,345
8,178,000
4,189
29,895
8,039
9,031
1,067
9,124
1,322,000
856,000
4,426,00C
510,00C
681,000
383,000
51,886
16,756,000
631
3,601
419,000
3,378,000
47,654
12,959,000
36,846
8,009,000
1,965
3,913
261,000
965,000
30,968
6,783,000
FEDERAL RESERVE DISTRICTS
DISTRICT NO. 1-BOSTON
Connecticut (excluding Fairfield County)
Maine
Massachusetts
New Hampshire
Rhode Island
Vermont
DISTRICT NO. 2—NEW YORK
Connecticut (Fairfield
New Jersey
Counties of—
Bergen
Essex
Hudson
New York
County)
Hunterdon
Middlesex
Monmouth
Morris
Passaic
Somerset
Sussex
Union
Warren
DISTRICT NO. 3—PHILADELPHIA
Delaware
New Jersey
Counties of—
Atlantic
Cape May
Burlington
Cumberland
Camden
Pennsylvania (eastern part)
Counties of—
Adams
Clinton
Bedford
Columbia
Berks
Cumberland
Blair
Dauphin
Bradford
Delaware
Bucks
Elk
Cambria
Franklin
Cameron
Fulton
Carbon
Huntingdon
Center
Juniata
Chester
Lackawanna
Clearfield
Lancaster
Gloucester
Mercer
Ocean
Salem
Lebanon
Lehigh
Luzerne
Lycoming
McKean
Mifflin
Monroe
Montgomery
Montour
Northampton
Northumberland
Perry
Philadelphia
Pike
Potter
Schuylkill
Snyder
Sullivan
Susquehanna
Tioga
Union
Wayne
Wyoming
York
118
ANNUAL REPORT OF BOARD OF GOVERNORS
FEDERAL RESERVE DISTRICTS-Continued
Land area
(square
miles)
Federal Reserve district
DISTRICT NO. 4—CLEVELAND
Kentucky (eastern part^
Counties of—
Bath
Fleming
Bell
Floyd
Boone
Garrard
Bourbon
Grant
Boyd
Greenup
Bracken
Harlan
Breathitt
Harrison
Campbell
Jackson
Carter
Jessamine
Clark
Johnson
Clay
Kenton
Elliott
Knott
Estill
Knox
Fayette
Laurel
Ohio
Pennsylvania (western part)
Counties of—
Allegheny
Crawford
Armstrong
Erie
Beaver
Fayette
Butler
Forest
Clarion
Greene
West Virginia (northern part)
Counties of—
Brooke
Marshall
Hancock
Ohio
DISTRICT NO. 5—RICHMOND
District of Columbia.
^laryland
North Carolina
South Carolina
Virginia
West Virginia (southern nart,)
Counties of—
Hardy
Barbour
Harrison
Berkeley
Jackson
Boone
Jefferson
Braxton
Kanawha
Cabell
Lewis
Calhoun
Clay
Lincoln
Logan
Doddridge
McDowell
Fayette
Marion
Gilmer
Mason
Grant
Mercer
Greenbrier
Mineral
Hampshire
DISTRICT NO. 6—ATLANTA
Alabama..
Florida
Georgia
Louisiana (southern part")
Parishes of—
Acadia
Evangeline
Allen
Iberia
Ascension
Iberville
Assumption
Jefferson
Avoyelles
Jefferson Davis
Beauregard
Lafayette
Calcasieu
La Fourche
Cameron
Livingston
E a s t B a t o n Orleans
Rouge
Plaquemines
East Feliciana
Pointe Coupee
Mississippi (southern part)
Counties of—
Adams
Harrison
A mite
Hinds
Claiborne
Issaquena
Clarke
Jackson
Copiah
Jasper
Covington
Jefferson
Forrest
Jefferson Davis
Franklin
Jones
George
Kemper
Greene
Lamar
Hancock
Lauderdale
Lawrence
Lee
Leslie
Letcher
Lewis
Lincoln
McCreary
Madison
Magoffin
Martin
Mason
Menifee
Montgomery
Morgan
Nicholas
Owsley
Pendleton
Perry
Pike
Powell
Pulaski
Robertson
Rockcastle
Rowan
Scott
Whitley
Wolfe
Woodford
Indiana
Jefferson
Lawrence
Mercer
Somerset
Venango
Warren
Washington
Westmoreland
Population
July 1, 1937
(estimated)
73,424
17,614
.11,737,000
1,395,000
40,740
13,864
6,733,000
3,393,000
1,206
216,000
152,316
62
9,941
48,740
30,495
40,262
22,816
12,028,000
627,000
1,679,000
3,492,000
1,875,000
2,706,000
1,649,000
248,226
51,279
54,861
58,725
26,891
12,085,000
2,895,000
1,670,000
3,085,000
1,444,000
25,519
969,000
Tyler
Wetzel
Mingo
Monongalia
Monroe
Morgan
Nicholas
Pendleton
Pleasants
Pocahontas
Preston
Putnam
Raleigh
Randolph
Ritchie
Roane
Summers
Taylor
Tucker
Upshur
Wayne
Webster
Wirt
Wood
Wyoming
Rapides
St. Bernard
St. Charles
St. Helena
St. James
St. John the Baptist
St. Landry
St. Martin
St. Mary
St. Tammany
Tangipahoa
Terrebonne
Vermilion
Vernon
Washington
WestBaton
Rouge
West Feliciana
Lawrence
Leake
Lincoln
Madison
Marion
Neshoba
Newton
Pearl River
Perry
Pike
Rankin
Scott
Sharkey
Simpson
Smith
Stone
Walthall
Warren
Wayne
Wilkinson
Yazoo
119
FEDERAL RESERVE SYSTEM
FEDERAL RESERVE DISTRICTS—Continued
Land area
(square
miles)
Federal Reserve district
DISTRICT NO. 6—ATLANTA—Continued.
Tennessee (eastern pa rt)
Counties of—
Giles
Anderson
Grainger
Bedford
Greene
Bledsoe
Grundy
Blount
Hamblen
Bradley
Hamilton
Campbell
Hancock
Cannon
Hawkins
Carter
Hickman
Cheatham
Houston
Claiborne
Clay
Humphreys
Cocke
Jackson
Coffee
Jefferson
Cumberland
Johnson
Davidson
Knox
De Kalb
Lawrence
Dickson
Lewis
Fentress
Lincoln
Franklin
Loudon
McMinn
Macon
Marion
Marshall
Maury
Meigs
Monroe
Montgomery
Moore
Morgan
Overton
Perry
Pickett
Polk
Putnam
Rhea
Roane
Robertson
Rutherford
I
30,951
2,022,000
190,513
18,863,000
35,448
6,597,000
26,707
2,821,000
55,586
40,789
2,552,000
4,512,000
Scott
Sequatchie
Sevier
Smith
Stewart
Sullivan
Sumner
Trousdale
Unicoi
Union
Van Buren
Warren
Washington
Wayne
White
Williamson
Wilson
DISTRICT NO. 7.-CHICAG0
Illinois (northern part}
Counties of—
Boone
Ford
Bureau
Fulton
Carroll
Grundy
Cass
Hancock
Champaign
Henderson
Christian
Henry
Clark
Iroquois
Coles
Jo Daviess
Cook
Kane
Cumberland
Kankakee
DeKalb
Kendall
DeWitt
Knox
Douglas
Lake
Du Page
La Salle
Edgar
Lee
Indiana (northern part}
Counties of—
Fountain
Adams
Franklin
Allen
Fulton
Bartholomew
Grant
Benton
Hamilton
Blackford
Hancock
Boone
Hendricks
Brown
Henry
Carroll
Howard
Cass
Huntington
Clay
Jasper
Clinton
Jay
Dearborn
Jennings
Decatur
Johnson
DeKalb
Kosciusko
Delaware
Lagrange
Elkhart
Fayette
Iowa
Michigan (southern p*irt)
Counties of—
Eaton
Alcona
Emmet
Allegan
Genesee
Alpena
Gladwin
Antrim
Grand Traverse
Arenac
Barry
Gratiot
Bay
Hillsdale
Huron
Benzie
Ingham
Berrien
Ionia
Branch
Iosco
Calhoun
Isabella
Cass
Jackson
Charlevoix
Kalamazoo
Cheboygan
Kalkaska
Clare
Kent
Clinton
Lake
Crawford
Population
July 1, 1937
(estimated)
Livingston
Logan
McDonough
McHenry
McLean
Macon
Marshall
Mason
Menard
Mercer
Moultrie
Ogle
Peoria
Piatt
Putnam
Rock Island
Sangamon
Schuyler
Shelby
Stark
Stephenson
Tazewell
Vermilion
Warren
Whiteside
Will
Winnebago
Woodford
La Porte
Madison
Marion
Marshall
Miami
Monroe
Montgomery
Morgan
Newton
Noble
Ohio
Owen
Parke
Porter
Pulaski
Putnam
Randolph
Ripley
Rush
St. Joseph
Shelby
Starke
Steuben
Tippecanoe
Tipton
Union
Vermillion
Vigo
Wabash
Warren
Wayne*
Wells
White
Whitley
Lapeer
Leelanau
Lenawee
Livingston
Macomb
Manistee
Mason
Mecosta
Midland
Missaukee
Monroe
Montcalm
Montmorency
Muskegon
Newaygo
Oakland
Oceana
Ogemaw
Osceola
Oscoda
Otsego
Ottawa
Presque Isle
Roscommon
Saginaw
St. Clair
St. Joseph
Sanilac
Shiawassee
Tuscola
Van Buren
Washtenaw
Wayne
Wexford
120
ANNUAL REPORT OF BOARD OF GOVERNORS
FEDERAL RESERVE DISTRICTS—Continued
Land area
(square
miles)
Federal Reserve district
DISTRICT NO. 7— CHICAGO—Continued
Wisconsin (southern part)
Counties of—
Adams
Green Lake
Brown
Iowa
Jackson
Calumet
Clark
Jefferson
Columbia
Juneau
Crawford
Kenosha
Dane
Kewaunee
Dodge
Lafayette
Door
Langlade
Fond du Lac
Manitowoc
Grant
Marathon
Green
Marinette
Marquette
Milwaukee
Monroe
Oconto
Outagamie
Ozaukee
Portage
Racine
Richland
Rock
Sauk
Shawano
31,983
2,381,000
194,810
10,413,000
52,525
20,595
2,048,000
1,281,000
9,338
653,000
22,567
1,525,000
20,843
1,054,000
Sheboygan
Vernon
Walworth
Washington
Waukesha
Waupaca
Waushara
Winnebago
Wood
DISTRICT NO. 8—ST. LOUIS
Arkansas
Illinois (southern part1) - - Counties of—
Adams
Franklin
Alexander
Gallatin
Bond
Greene
Brown
Hamilton
Calhoun
Hardin
Clay
Jackson
Clinton
Jasper
Crawford
Jefferson
Edwards
Jersey
Emngham
Johnson
Fayette
Lawrence
Indiana (southern part)
Counties of—
Clark
Greene
Crawford
Harrison
Daviess
Jackson
Dubois
Jefferson
Floyd
Knox
Gibson
Lawrence
Kentucky (western part)
Counties of—
Adair
Crittenden
Allen
Cumberland
Anderson
Daviess
Ballard
Edmonson
Barren
Franklin
Boyle
Fulton
Breckinridge
Gallatin
Bullitt
Graves
Butler
Grayson
Caldwell
Green
Calloway
Hancock
Carlisle
Hardin
Carroll
Hart
Casey #
Henderson
Christian
Henry
Clinton
Hickman «
Mississippi (northern part)
Counties of—
Alcorn
De Soto
Grenada
Attala
Holmes
Benton
Bolivar
Humphreys
Calhoun
Itawamba
Carroll
Lafayette
Chickasaw
Lee
Choctaw
Lefiore
Clay
Lowndes
Coahoma
Marshall
Population
July 1, 1937
(estimated)
Macoupin
Madison
Marion
Massac
Monroe
Montgomery
Morgan
Perry
Pike
Pope
Pulaski
Randolph
Richland
St. Clair
Saline
Scott
Union
Wabash
Washington
Wayne
White
Williamson
Martin
Orange
Perry
Pike
Posey
Scott
Spencer
Sullivan
Switzerland
Vanderburg
Warrick
Washington
Hopkins
Jefferson
Larue
Livingston
Logan
Lyon
McCracken
McLean
Marion
Marshall
Meade
Mercer
Metcalfe
Monroe
Muhlenberg
Nelson
Ohio
Oldham
Owen
Russell
Shelby
Simpson
Spencer
Taylor
Todd
Trigg
Trimble
Union
Warren
Washington
Wayne
Webster
Monroe
Montgomery
Noxubee
Oktibbeha
Panola
Pontotoc
Prentiss
Quitman
Sunflower
Tallahatchie
Tate
Tippah
Tishomingo
Tunica
Union
Washington
Webster
Winston
Yalobusha
121
FEDERAL RESERVE SYSTEM
FEDERAL RESERVE DISTRICTS-Continued
Land area
(square
miles)
Federal Re 3erve district
DISTRICT NO. 8.-ST. LOUIS-Continued.
Missouri (eastern part)
Counties of—
Douglas
Adair
Audrain
Dunklin
Barry
Franklin
Benton
Gasconade
Bollinger
Greene
Boone
Grundy
Butler
Harrison
Caldwell
Henry
Callaway
Hickory
Camden
Howard
Cape Girardeau Howell
Carroll
Iron
Carter
Jefferson
Cedar
Johnson
Chariton
Knox
Christian
Laclede
Clark
Lafayette
Cole
Lawrence
Cooper
Lewis
Crawford
Lincoln
Dade
Linn
Dallas
Livingston
Daviess
Macon
Dent
Madison
Tennessee (western pjirt)
Counties of—
Benton
Fayette
Carroll
Gibson
Chester
Hardeman
Crockett
Hardin
Decatur
Haywood
Dyer
Henderson
Population
July 1, 1937
(estimated)
58,206
2,981,000
10,736
871,000
414,004
5,452,000
16,691
318,000
146,131
70,183
76,868
23,273
80,858
2,652,000
539,000
706^000
692,000
545,000
DISTRICT NO. 10—KAN,sAS CITY
480,438
8,155,000
Colorado
Kansas
Missouri (western part)
Counties of—
Cass
Andrew
Atchison
Clay
Barton
Clinton
Bates
DeKalb
Buchanan
Gentry
Nebraska
Mew Mexico (northern part)
Counties of—
Bernalillo
Mora
Colfax
Rio Arriba
Harding
Sandoval
McKinley
San Juan
103,658
81,774
10,521
1,071,000
1,864,000
1,008,000
76,808
48,359
1,364,000
231,000
Maries
Marion
Mercer
Miller
Mississippi
Moniteau
Monroe
Montgomery
Morgan
New Madrid
Oregon
Osage
Ozark
Pemiscot
Perry
Pettis
Phelps
Pike
Polk
Pulaski
Putnam
Rails
Randolph
Ray
Reynolds
Ripley
St. Charles
St.Clair
St. Francois
St. Louis
St. Louis City
Ste. Genevieve
Saline
Schuyler
Scotland
Scott
Shannon
Shelby
Stoddard
Stone
Sullivan
Taney
Texas
Warren
Washington
Wavne
Webster
Wright
Henry
Lake
Lauderdale
McNairy
Madison
Obion
Shelby
Tipton
Weakley
DISTRICT NO. 9.—MINNEAPOLIS
Michigan (northern p art)
Counties of—
Alger
Dickinson
Baraga r
Gogebic
Chippew a
Houghton
Delta
Iron
Minnesota
^Montana
North Dakota .
South Dakota
Wisconsin (northern part)
Counties of—
Ashland
Dunn
Barron
Ea a Claire
Baytield
Florence
Buffalo
Forest
Burnett
Iron
Chippewa
La Crosse
Douglas
Lincoln
Keweenaw
Luce
Mackinac
Marquette
Oneida
Pepin
Pierce
Polk
Price
Rusk
St. Croix
Holt
Jackson
Jasper
McDonald
Newton
San Miguel
Santa Fe
Taos
Union
Me no mi nee
Ontonagon
Schoolcraft
Sawyer
Taylor
Trempealeau
Vilas
Washburn
Nodaway
Platte
Vernon
Worth
Valen
122
ANNUAL REPORT OF BOARD OF GOVERNORS
FEDERAL RESERVE DISTRICTS—Continued
Land area
(square
miles)
Federal Reserve district
DISTRICT NO. 10.-KANSAS CITY-Continued.
Oklahoma (northwestern narti
Counties of—
Ellis
Adair
Logan
Alfalfa
Garfield
Love
Beaver
Garvin
McClain
Beckham
Grady
Mclntosh
Blaine
Grant
Major
Caddo
Greer
Mayes
Canadian
Harmon
Murray
Harper
Carter
Muskogee
Cherokee
Haskell
Noble
Hughes
Cimarron
Nowata
Jackson
Cleveland
Okfuskee
Comanche
Jefferson
Oklahoma
Cotton
Kay
Okmulgee
Craig
Kingfisher
Osage
Creek
Kiowa
Ottawa
Custer
Latimer
Pawnee
Delaware
Le Flore
Payne
Dewey
Lincoln
Pittsburg
Wyoming
61,770
Pima
Santa Cruz
Madison
Morehouse
Natchitoches
Ouachita
Red River
Richland
Sabine
Tensas
Union
Webster
West Carroll
Winn
Lincoln
Luna
Otero
Quay
Roosevelt
Sierra
Socorro
Torrance
Johnston
McCurtain
Marshall
Pu3hmataha
DISTRICT NO. 12.-SAN FRANCISCO..
Arizona (northwestern narM
Counties of—
Apache
Maricopa
Coconino
Mohave
Gila
California
Idaho
. ..
Nevada
Oregon
Utah
Washington
Navajo
Pinal
2,382,000
Pontotoc
Pottawatomie
Roger Mills
Rogers
Seminole
Sequoyah
Stephens
Texas
Tillman
Tulsa
Wagoner
Washington
Washita
Woods
Woodward
DISTRICT NO. 11—DALLAS
Arizona (southeastern r»artA
Counties of—
Cochise
Greenlee
Graham
Louisiana (northern part")
Parishes of—
De Soto
Bienville
Bossier
East Carroll
Caddo
Franklin
Caldwell
Grant
Catahoula
Jackson
Claiborne
La Salle
Concordia
Lincoln
New Mexico (southern nart")
Counties of—
Catron
Eddy
Chaves
Grant
Curry
Guadalupe
De Baca
Hidalgo
Dona Ana
Lea
Oklahoma (southeastern nart,^
Counties of—
Atoka
Choctaw
Bryan
Coal
Texas
Population
July 1, 1937
(estimated)
97,548
235,000
386,116
7,337,000
23,412
120,000
18,518
688,000
74,144
191,000
7,644
166,000
262,398
6,172,000
683,852
10,244,000
90,398
292,000
155,652
83,354
109,821
95,607
82,184
66,836
6,154,000
493,000
101,000
1,027,000
519,000
1,658,000
Yavapai
Yuraa
FEDERAL RESERVE SYSTEM
123
FEDERAL RESERVE BRANCH TERRITORIES
(December 31, 1938)
BUFFALO BRANCH (District No. 2).—The 10 most westerly counties of New York State, as follows:
Monroe
Orleans
Allegany
. Wyoming
Chautauqua
Genesee
Erie
Cattaraugus
Livingston
Niagara
CINCINNATI BRANCH (District No. 4).—That part of Kentucky in Federal Reserve district No. 4, and
the following 25 counties in southern Ohio:
Adams
Clermont
Greene
Meigs
Ross
Hamilton
Miami
Scioto
Athens
Clinton
Highland
Montgomery
Vinton
Brown
Darke
Jackson
Pike
Warren
Butler
Fayette
Lawrence
Preble
Washington
Clark
Gallia
PITTSBURGH BRANCH (District NO. 4).—Those portions of the States of Pennsylvania and West Virginia
included in Federal Reserve district No. 4.
BALTIMORE BRANCH (District No. 5).—The State of Maryland and the following 30 counties of West
Virginia:
Barbour
Grant
Lewis
Pendleton
Taylor
Berkeley
Hampshire
Marion
Pleasants
Tucker
Braxton
Hardy
Mineral
Preston
Upshur
Calhoun
Harrison
Monongalia
Randolph
Webster
Doddridge
Jackson
Morgan
Ritchie
Wirt
Gilmer
Jefferson
Nicholas
Roane
Wood
CHARLOTTB BRANCH (District No. 5).—The following counties in the States of North Carolina and
South Carolina:
NORTH CAROLINA
Alexander
Alleghany
Ashe
Avery
Buncombe
Burke
Cabarrus
Caldwell
Catawba
Cherokee
Clay
Cleveland
Gaston
Graham
Hay wood
Henderson
Iredell
Jackson
Lincoln
Macon
Madison
McDowell
Mecklenburg
Mitchell
Polk
Rowan
Rutherford
Stanly
Swain
Transylvania
Union
Watauga
Wilkes
Yancey
SOUTH CAROLINA
Newberry
Abbeville
Edgefield
Lancaster
Saluda
Aiken
Fair-field
Laurens
Oconee
Spartanburg
Anderson
Greenville
Lexington
Pickens
Union
Cherokee
Greenwood
McCormick
Richland
York
Chester
BIRMINGHAM BRANCH (District No. 6).—The State of Alabama except the following counties: Mobile,
Baldwin, Russell, Pike, Barbour, Coffee, Dale, Henry, Covington, Geneva, and Houston, and towns
and cities in Lee and Chambers counties located on or south of the Atlanta & West Point Railroad
and the Western Railway of Alabama.
JACKSONVILLE BRANCH (District No. 6).—The entire State of Florida.
NASHVILLE BRANCH (District No. 6).—That part of the State of Tennessee included in Federal Reserve
district No. 6 with the exception of the city of Chattanooga.
NEW ORLEANS BRANCH (District No. 6).—Those parts of the States of Louisiana and Mississippi
located in Federal Reserve district No. 6, and the counties of Mobile and Baldwin in Alabama.
SAVANNAH AGENCY (District No. 6).—Savannah, Ga.
DETROIT BRANCH (District No. 7).—The following 19 counties in the State of Michigan:
Bay
Ingham
Livingston
Saginaw
Tuscola
G
Jk
Mb
Sil
Washtenaw
Genesee
Jackson
Macomb
Sanilac
Wayne
Hillsdale
Lapeer
Monroe
St. Clair
Huron
Lenawee
Oakland
Shiawassee
LITTLE ROCK BRANCH (District No. 8).—The State of Arkansas except the following counties-:
Baxter 1
Craighead
Greene
Mississippi
Sebastian 2
Benton
Crawford
Lawrence
Phillips
Sharp
Boone
Crittenden
Lee
Poinsett
Washington
Carroll
Cross
Madison
Randolph
Woodruff
Clay
Fulton
Marion
St. Francis
and except also the towns of DeValls Bluff (Prairie County), Mena (Polk County), and Newport
(Jackson County).
1
Town of Gentry assigned to Little Rock Branch.
Town of Mansfield assigned to Little Rock Branch.
LOUISVILLE BRANCH (District No. 8).—That part of the State of Kentucky included in Federal
Reserve District No. 8, with the exception of the town of Morganfield (Union County), and the following 14 counties in the State of Indiana:
Clark
Floyd
Jefferson
Orange
Switzerland
Crawford
Harrison
Lawrence
Perry
Washington
Dubois 1
Jackson
Martin 2
Scott
2
1
Except the towns of Ferdinand and Holland.
Except the town of Loogootee.
Digitized for 2FRASER
124
ANNUAL REPORT OF BOARD OF GOVERNORS
MEMPHIS BRANCH (District No. 8).—Those parts of the States of Mississippi and Tennessee included in Federal Reserve District No. 8, with the exception of Union City (Obion County) Tennessee and Paris (Henry County) Tennessee, and the following 10 counties in the State of Arkansas:
Craighead
Cross
Lee
Phillips
St. Francis
Crittenden
Lawrence
Mississippi
Poinsett
Woodruff
also the town of DeValls Bluff (Prairie County), Arkansas.
HELENA BRANCH (District No. 9).—The entire State of Montana.
DENVER BRANCH (District No. 10).—The entire State of Colorado and that part of the State of New
Mexico included in Federal Reserve District No. 10.
OKLAHOMA CITY BRANCH (District No. 10).—That part of the State of Oklahoma located in Federal
Reserve District No. 10.
OMAHA BRANCH (District No. 10).—The entire States of Nebraska and Wyoming.
EL PASO BRANCH (District No. 11).—That part of the States of Arizona and New Mexico located in
Federal Reserve District No. 11, and the following 14 counties in the State of Texas:
Andrews
Ector
Jeff Davis
Midland
Ward
Crane
El Paso
Loving
Pecos
Winkler
Culberson
Hudspeth
Martin
Reeves
HOUSTON BRANCH (District No. 11).—The following 43 counties in the southeastern part of the State of
Texas:
Anderson
Cherokee
Jackson
Nacogdoches
Shelby
Angelina
Colorado
Jasper
Newton
Trinity
Austin
Fayette
Jefferson
Orange
Tyler
Bastrop
Fort Bend
Lavaca
Polk
Victoria
Brazoria
Galveston
Lee
Refugio
Walker
Brazos
Grimes
Liberty
Sabine
Waller
Burleson
Hardin
Madison
San Augustine
Washington
Calhoun
Harris
Matagorda
San Jacinto
Wharton
Chambers
Houston
Montgomery
SAN ANTONIO BRANCH (District No. 11).—The following 52 counties in the State of Texas:
Aransas
De Witt
Jim Hogg
Llano_
Starr
Atascosa
Dimmit
Jim Wells
Live Oak
Terrell
Karnes
Mason
Travis
Bandera
Duval
Kendall
Bee
Edwards
Maverick
Uvalde
Kenedy
McMulIen
Val Verde
Bexar
Frio
Kerr
Blanco
Gillespie
Medina
Webb
Kimble
Nueces
Willacy
Brewster
Goliad
Kinney
Brooks
Gonzales
Presidio
Wilson
Kleberg
Caldwell
Guadalupe
Real
Zapata
La Salle
San Patricio
Za valla
Cameron
Hays
Comal
Hidalgo
Los ANGELES BRANCH (District No. 12).—That part of the State of Arizona located in Federal Reserve
District No. 12, and the following counties in California:
Imperial
Los Angeles
Riverside
San Diego
Ventura
Inyo
Orange
San Bernardino
Santa Barbara
PORTLAND BRANCH (District No. 12).—The entire State of Oregon, and the town of Ilwaco and the
following nine counties in the State of Washington:
Asotin
Columbia
Garfield
Skamania
Walla Walla
Clark
Cowlitz
Klickitat
Wahkiakum
Also, the following counties in the State of Idaho:
Benewah
Boundary
Idaho
Latah
Nez Perce
Bonner
Clearwater
Kootenai
Lewis
Shoshone
SALT LAKE CITY BRANCH (District No. 12).—The entire State of Utah and the following counties in
Idaho and Nevada:
IDAHO
Ada
Adams
Bannock
Bear Lake
Bingham
Blaine
Boise
Bonneville
Butte
Camas
Canyon
Caribou
Cassia
Clark
Custer
Elmore
Franklin
Fremont
Gem
Gooding
Jefferson
Jerome
Lemhi
Lincoln
Madison
Minidoka
Oneida
Owyhee
Payette
Power
Teton
Twin Falls
Valley
Washington
NEVADA
White Pine
Lincoln
Elko
Clark
SEATTLE BRANCH (District No. 12).—The entire State of Washington except the town of Ilwaco and
the following nine counties which are affiliated with the Portland Branch:
Asotin
Columbia
Garfield
Skamania
Walla Walla
Clark
Cowlitz
Klickitat
Wahikiakum
FEDERAL RESERVE DISTRICTS
•
H
. — i
($
•
O
BOUNDARIES OF FEDERAL RESERVE DISTRICTS
H
BOUNDARIES OF FEDERAL RESERVE BRANCH TERRITORIES
(APPROXIMATE IN THE ST. LOUIS DISTRICT)
FEDERAL RESERVE BANK CITIES
FEDERAL RESERVE BRANCH CITIES
FEDERAL RESERVE BANK AGENCY
INDEX
Acceptances:
Page
Buying rates
58
Member bank holdings, Sept. 28, 1938
64
Assets and liabilities. (See Condition statements.)
Bank directorates, Interlocking:
Regulation L, amendments:
Policy action of Board of Governors on
,
74
Summary of changes
35
Bank examinations:
Conflict of authority
14
Federal Advisory Council recommendations
85
Procedure revised:
Description of
89, 90
Discussion of
4, 15, 37-39
Relation between examination policies and credit policies
4, 17
Report on banks examined
36
Uniformity in examination policy. Problem of
4
Bank mergers. (See Banks: Consolidations, absorptions, etc.)
Bank supervision:
Allocation of authority
11
Chart of principal bank supervisory relationships
9
Confusion and conflict of authority
12
Discriminations in
3
Examination policy, Problem of uniformity in
4
Growth and pattern
2
Relation between examination, supervision and credit policies
4
Relation between supervisory and credit policies
16
Responsibility diffused
3
Bankers' acceptances. (See Acceptances.)
Banking and financial legislation:
Federal Deposit Insurance Corporation:
Authority to make loans to or purchase assets from insured banks.
Pub. res. no. 116, 75th Congress.
35
Double liability of stockholders waived. Pub. no. 544, 75th Congress. . 35
Federal statutory provisions regulating banks:
Discussion of discriminatory Federal laws
10
List of
*
87
>
Laws and jurisdictions to which banks are subject
8
Loans to executive officers of member banks extended. Pub. no. 492, 75th
Congress
34
Banking developments in 1938, Discussion of
27
Banking offices:
Number of, 1933-1938
66
Banking structure in United States, June 30, 1938
7
Banking system:
Changes in character of banking
7
Composition of
2, 6
Discriminatory Federal laws
10
Laws and jurisdictions to which banks are subject
8
Banks:
Branches:
Number of:
1933-1938
66
1938, Analysis of changes in
67
Consolidations, absorptions, etc
67
Loans to, by member banks:
Sept. 28, 1938
64
Number of:
1933-1938
66
1938, Analysis of changes in
67
Suspensions
67
;
(See also Federal Reserve banks; Member banks; National member
banks; Nonmember banks; State member banks.)
127
128
INDEX
Bills:
Page
Bought in open market by Federal Reserve banks:
All banks combined:
1918-1938, End of year
figures
61
1938, End of month
figures
61
Dec. 31, 1938
45
Each bank, end of year
figures
48
Earnings on
54
Volume of operations
53
Discounted by Federal Reserve banks:
All banks combined:
1918-1938, End of year
figures
61
1938, End of month
figures
61
Dec. 31, 1938, in detail
:
45
Each bank, end of year
figures
48
Earnings on
54
Volume of operations
53
Federal Reserve bank holdings:
Maturity distribution
47
Blattner, George W., resigned as Assistant Director of Division of Research and
Statistics of the Board of Governors
41
Board of Governors of Federal Reserve System:
Annual Report, Change in form of publication
42
Bank examination procedure, revised:
Description of
89, 90
Discussion of
4, 15, 37-39
Bank examinations
14
Bank supervision
3, 11
Blattner, George W., resigned
41
Condition report form revised
36
Directory of
94
Draper, Ernest G., appointed member
41
Expenses
-. 41, 100
Hamlin, Charles S., Death of
41
Holding company affiliates supervision
13
Interest on deposits, Regulation of
13
Investment securities regulation, Enforcement of
12
Policy actions:
Regulation D, Reserve requirements
73
Regulation L, Interlocking directorates
74
Regulation T, Margin requirements for brokers
73
Power to control excess reserves
5
Receipts and disbursements
100
Salaries of officers and employees
95-99
Bonds:
Appraisal of bonds in bank examinations
89
United States Government. {See United States Government securities.)
Yields:
Monthly and yearly
figures
68
Branch banks:
Foreign
40
Number of:
1933-1938
66
1938, Analysis of changes in
67
Brokers and dealers in securities:
Loans to, by member banks:
Sept. 28, 1938
64
Building contracts. {See Construction contracts.)
Business and credit conditions:
Discussion of
• • • 22-25, 27
Capital:
Federal Reserve banks:
All banks combined, Dec. 31, 1938
46
Each bank, end of year
figures
48
Capital movements to United States:
Discussion of
25
Effect on bank reserves
20
INDEX
129
Pa e
Capital stock:
s
Member banks:
Sept. 28, 1938
.....
65
Dec. 31, 1938
. . 63
Car loadings, Freight. (See Freight-car loadings.)
Central reserve city member banks:
Assets and liabilities, Dec. 31, 1938:
Chicago
62
New York City
62
Classification of loans, investments and capital stock, Sept. 28, 1938
64
Charts:
Industrial production
23
Principal bank supervisory relationships
9
Check clearing and collection:
Par list, number of banks on
33
Volume of operations at Federal Reserve banks
53
Claims on the United States, Federal Advisory Council recommendation on
assignment of
86
Clayton Act:
"Morris Plan bank" under amendment of Regulation L, Board of Governors
35, 74
Coin received and counted by Federal Reserve banks
53
Commercial paper:
Discount rates, open market
68
Member bank holdings, Sept. 28, 1938
64
Commitment rates:
Federal Reserve banks
58
Comptroller of the Currency:
Bank examination procedure, revised:
Description of
89, 90
Discussion of
4, 15, 37-39
Bank examinations
14
Bank supervision
3, 11
Condition report form revised
36
Interest on deposits regulation, Enforcement of
13
Investment securities regulation:
Enforcement of
12
Revision of
91-93
Condition statements:
Federal Reserve banks:
All banks combined; Dec. 31, 1938
45
Each bank, end of year figures
48
Member banks:
Sept. 28, 1938
64
Dec. 31, 1938
62
Revised form of condition reports
36
Consolidations, absorptions, etc. (See Banks: Consolidations, absorptions.)
Construction contracts awarded:
Discussion of
24
Indexes of value of
69
Corporations, Foreign banking. (See Foreign banking corporations.)
Country member banks:
Assets and liabilities, Dec. 31, 1938
62
Classification of loans, investments, and capital stock, Sept. 28, 1938
64
Credit, Bank:
Federal Reserve:
1918-1938, End of year figures
61
1938, End of month figures
61
Credit policies:
Relation between examination policies and credit policies
4, 17
Relation between supervisory and credit policies
16
Reserves and credit regulation
18
Currency:
Circulation. (See Money in circulation.)
Received and counted by Federal Reserve banks
53
Department
69
store sales (value) index
130
INDEX
Deposits:
Page
All banks in U. S.:
Discussion of
27, 29
Federal Reserve banks:
All banks combined, Dec. 31, 1938
46
Each bank, end of year figures
48
Interest on. (See Interest on deposits, Interest rates.)
Member banks:
Dec. 31, 1938..
63
Nonmember deposits in Federal Reserve banks:
1918-1938, End of year figures
61
1938, End of month figures
61
Reserves required against. (See Reserve requirements.)
Savings:
Payment of interest on. (See Interest on deposits.)
Velocity of:
Discussion of
. 29
Directorates, Interlocking. (See Bank directorates, Interlocking.)
Discount rates:
Federal Reserve banks
58
• Dividends:
Federal Reserve banks
55, 56
Member banks
63
Double liability of stockholders:
Federal Deposit Insurance Corporation waiver of. Pub. no. 544, 75th
Congress
35
Draper, Ernest G., appointed member of Board of Governors of Federal Reserve System
41
Durable goods production index
69
Earnings and expenses:
Federal Reserve banks:
All banks combined
56
Discussion of
29-31
Each bank
54
Edge Act corporations:
Examination of
36
List of
40
Employment, Factory:
Discussion of
25
Indexes
69
Examinations. (See Bank examinations.)
Executive officers of member banks:
Loans to:
Public act, amended, extending period to June 16, 1939
34
Expenses:
Board of Governors of Federal Reserve System
100
Federal Reserve banks
54, 56
Factory employment. (See Employment, Factory.)
Federal Advisory Council:
Directory of
103
Meetings
41
Recommendations to Board of Governors:
May 17, 1938. Unification of bank examinations
85
Nov. 29, 1938. Assignment of Claims on the United States
86
Federal Deposit Insurance Corporation:
Authority to make loans to or purchase assets from insured banks. Pub.
res. no. 116, 75th Congress
35
Bank examination procedure, revised:
Description of
89, 90
Discussion of
4, 15, 37-39
Bank examinations
14
Bank supervision
3, 11
Condition report form revised
. 36
Double liability of stockholders waived. Pub. no. 544, 75th Congress
35
Interest on deposits, Regulation of
13
Membership changes
67
INDEX
131
Pa e
Federal Open Market Committee:
s
Directory of
102
Meetings
41
Policy actions
76-84
Press statement
83
Regulation relating to open-market operations amended
36
Federal Reserve Act:
Amendments, 75th Congress:
Double liability of stockholders waived by Federal Deposit Insurance
Corporation. Pub. no. 544
35
Federal Deposit Insurance Corporation to make loans to or purchase
assets of insured banks. Pub. res. no. 116
35
Loans to executive officers of member banks extended. Pub. no. 492.. . 34
Federal Reserve agents:
List of
104-107
Federal Reserve banks:
Agencies:
Havana Agency of Federal Reserve Bank of Atlanta discontinued.... 32
Assessment for expenses of Board of Governors
55
Branches:
Directors, List of
104-107
Spokane branch of Federal Reserve Bank of San Francisco discontinued 32
Building operations
33
Chairmen, List of
104-1Q7
Directors, List of
104-107
Dividends paid:
All banks combined
56
Each bank
55
Earnings and expenses:
All banks combined
56
Discussion of
29-31
Each bank
54
Employees, number and salaries
108
Presidents, List of
104-107
Profit and loss account
55
Retirement system contributions
54
Salaries of officers and employees
54, 108
Volume of operations
53
Federal Reserve branch banks. (See Federal Reserve banks: Branches.)
Federal Reserve districts:
Area, square miles
117-122
Branch territories:
Changes in
32
Counties comprising
'.
123
Map showing outline
125
Population
117-122
Federal Reserve notes:
Circulation
48
Collateral security
48
Issued
48
Redemption fund:
All banks combined, Dec. 31, 1938
45
Each bank, end of year
figures
48
Federal Reserve System:
Membership changes
67
Fiduciary powers of national banks. (See Trust powers of national banks.)
Financial conditions. (See Business and credit conditions.)
Financial legislation. (See Banking and financial legislation.)
Foreign banking corporations:
Examination of
36
List of
'
40
Foreign banks:
Central banks:
Credits to, by Federal Reserve banks
33
Deposits of, held by Federal Reserve banks:
All banks combined, Dec. 31, 1938
46
Each bank, end of year
figures
48
132
INDEX
Franchise tax paid by Federal Reserve banks to Government, 1917-1932
Freight-car loadings:
Indexes
..
Gold:
Movements :
Discussion of
Discussion of effect on bank reserves
Stock, Monetary in U. S.:
1918-1938, End of year figures
1938, End of month figures
Gold certificates:
Federal Reserve bank holdings:
All banks combined, Dec. 31, 1938
Each bank, end of year
figures
Government bonds. (See United States Government securities.)
Hamlin, Charles S., Death of
Havana Agency of Federal Reserve Bank of Atlanta discontinued
Holding company affiliates:
Conflict of authority in supervision of
Permits granted
Hungary, National Bank of:
Syndicate Credits Agreement carried out
Idle funds, Discussion of
Income:
Agricultural:
Discussion of . .
Payments:
Discussion of
Indexes
Industrial advances of Federal Reserve banks:
All banks combined, Dec. 31, 1938. .
Commitments
Discussion of
Each bank, end of year
figures
Earnings on
Maturity distribution
Rates
•
Volume of operations
Industrial production. (See Production, Industrial.)
Interdistrict collection system:
Membership in
:
Volume of operations at Federal Reserve banks
Interest on deposits:
Regulation of
Interest rates:
Federal Reserve banks
Open market, in N.Y.C
Time deposits
(See also Discount rates.)
Interlocking bank directorates. (See Bank directorates, Interlocking.)
Investments:
Classification in bank examinations:
Description of
Discussion of
Comptroller of the Currency regulation:
Enforcement of
Revision of
Member banks:
Sept. 28, 1938
Discussion of
(See also Loans and investments.)
Laws and legislation. (See Banking and financial legislation.)
Liabilities. (See Condition statements.)
Loans:
Classification in bank examinations:
Description of
Page
56
69
25
20
61
61
45
48
41
32
13
39
33
28
25
24, 25
69
45
48
32
48
54
47
58
53
33
53
13
58
68
59
89
37-39
12
91-93
64
28
89
INDEX
133
Pa e
Loans—Continued.
^
Classification in bank examinations—Continued.
Discussion of
37-39
Industrial. (See Industrial advances of Federal Reserve banks.)
Real estate. (See Real estate loans.)
Security. (See Securities: Loans on.)
Total for member banks:
Sept. 28, 1938
64
Loans and investments:
Member banks:
Sept. 28, 1938
64
Dec. 31, 1938
C62^,
Discussion of
,
"28'
Margin requirements:
Brokers and dealers in securities. Regulation T:
Agreement of nonmember banks under Sec. 8(a) of Securities Exchange
Act of 1934
,
21
Amendment
36
Policy action of Board of Governors on
73
Maturities:
Bills held by Federal Reserve banks. (See Bills: Federal Reserve bank
holdings.)
United States Government securities held by Reserve banks. (See United
States Government securities: Federal Reserve bank holdings.)
Member banks:
Bills discounted for. (See Bills: Discounted by Federal Reserve banks.)
Branches, Foreign
.
40
Condition of. (See Condition statements.)
Deposits. (See Deposits.)
Earnings and expenses. (See Earnings and expenses.)
Loans and investments. (See Loans and investments.)
National banks. (See National member banks.)
Reserves. (See Reserves.)
State banks. (See State member banks.)
Minerals production index
69
Monetary gold stock. (See Gold: Stock, Monetary.)
Monetary legislation. (See Banking and financial legislation.)
Monetary policy, Discussion of
21
Money in circulation:
1918-1938, End of year figures
61
1938, End of month figures
61
Money rates:
Discussion of
29
Open market, in N. Y. C
68
Morris Plan and industrial banks:
"Morris Plan bank" under amendment of Regulation L, Board of Governors
35, 74
Mutual savings banks:
Banking offices, 1933-1938
66
Branches:
1933-1938 .
66
1938, Analysis of changes in
67
Number of:
1933-1938
..9
1938, Analysis of changes in
National Association of Supervisors of State Banks:
Executive Council approved revised form of condition reports
National income. (See Income.)
National member banks:
Assets and liabilities, Dec. 31, 1938
Banking offices, 1933-1938
Branches:
Number of:
1933-1938
1938, Analysis of changes in
Classification of loans, investments and capital stock, Sept. 28, 1938
Number of:
1933-1938
66
67
36
62
66
66
67
64
68
134
INDEX
Pa e
National member banks—Continued.
s
Number of—Continued.
1938, Analysis of changes in
67
Trust powers. (See Trust powers of national banks.)
Nondurable goods production index
69
Nonmember banks:
Deposits of, held by Federal Reserve banks:
1918-1938, End of year figures
61
1938, End of month figures
61
Insured:
Banking offices, 1933-1938
66
Branches:
1933-1938
66
1938, Analysis of changes in
67
Number of:
1933-1938
"
66
1938, Analysis of changes in
67
Uninsured:
Banking offices, 1933-1938
66
Branches:
1933-1938
66
1938, Analysis of changes in
67
Number of:
1933-1938
66
1938, Analysis of changes in
67
Number of banks. (See Banks: Number of.)
Open Market Committee. (See Federal Open Market Committee.)
Open-market operations:
Federal Open Market Committee policy actions
76-84
Regulation of Federal Open Market Committee amended
36
Par collection system:
Membership in
33
Payrolls, Factory:
Discussion of
24, 25
Index
69
Policy actions. (See Board of Governors of Federal Reserve System: Policy
actions; Federal Open Market Committee: Policy actions.)
Postal savings deposits:
Interest rate on, paid by member banks
59
Prices, Wholesale commodity:
Discussion of
25
Index
69
Private banks:
Banking offices, 1933-1938
66
Branches:
1933-1938
66
1938, Analysis of changes in
67
Number of:
1933-1938
66
1938, Analysis of changes in
67
Production, Industrial:
Chart #
23
Discussion of
24
Indexes
69
Profits:
Securities profits in bank examinations
90
Real estate loans:
Member banks, Sept. 28, 1938
64
Reconstruction Finance Corporation:
Bank supervision
3, 11
Redemption fund, Federal Reserve notes. • (See Federal Reserve notes: Redemption fund.)
Regulations of Board of Governors:
Regulation D, Reserve requirements:
Policy action of Board on
73
Supplement, decreasing
35
Regulation L, Interlocking directorates:
Amendments
•
35
INDEX
135
Pa e
Regulation of Board of Governors—Continued.
s
Regulation L, Interlocking directorates—Continued.
Policy actions of Board on
74
Regulation T, Margin requirements for brokers:
Agreement of nonmember banks under sec. 8(a) of Securities Exchange
Act of 1934 and Board's Regulation T
34
Amendment
36
Policy action of Board on
73
Reserve bank credit. (See Credit, Bank.)
Reserve city member banks:
Assets and liabilities, Dec 31, 1938
62
Classification of loans, investments, and capital stock, Sept. 28, 1938
64
Reserve requirements for member banks:
Discussion of
18Reduction in:
Regulation D :
Policy action of Board of Governors on
73
Supplement
35
Table
60
Reserves:
All banks in United States:
Discussion of
27
Excess:
Discussion of
29
Federal Reserve banks:
All banks combined, Dec. 31, 1938
45
Each bank, end of year figures
48
Ratio to liabilities
48
Member banks:
Account in Federal Reserve banks:
All banks combined, Dec. 31, 1938
45
Each bank, end of year figures
48
Discussion of:
Factors of change in reserves
20
Growth in reserves in recent years
5
Nature and function of bank reserves
4
Reserves and credit regulation
18
Sources of reserves
19
Treasury powers affecting reserves
5, 21
Excess:
1931-1938, End of year figures
61
1938, End of month
figures
61
Discussion of
5, 18, 21, 27
Total:
1918-1938, End of year
figures
61
1938, End of month
figures
61
Salaries:
Board of Governors, officers and employees
95-99
Federal Reserve banks
54, 108
Savings deposits:
Interest rate on
59
Securities:
Classification in bank examinations:
Description of
89
Discussion of
37-39
Comptroller of the Currency regulation of investment securities:
Enforcement of
12
Revision of
91-93
Loans on, by member banks:
Sept. 28, 1938
64
Profits, Bank examination treatment of
90
United States Government. (See United States Government securities.)
Securities exchange act of 1934:
Agreement of nonmember banks under
34
Spokane branch of Federal Reserve Bank of San Francisco discontinued
, 32
State
member banks:
Assets and liabilities, Dec. 31, 1938
62
136
INDEX
State member banks—Continued.
Page
Banking offices, 1933-1938
66
Branches:
Number of:
1933-1938 .
m
1938, Analysis of changes in
67
Classification of loans, investments and capital stock, Sept. 28, 1938
64
Examinations of
37
List of, Dec. 31, 1938
109-117
Number of:
1933-1938
66
1938, Analysis of changes in
67
Stock prices
68
Supervision of banks. (See Bank supervision.)
Surplus:
Federal Reserve banks
55, 56
Member banks
63
Suspensions, Bank. (See Banks: Suspensions.)
Treasury cash and deposits with Federal Reserve banks. (See United States
Government deposits: Federal Reserve banks.)
Treasury currency outstanding
61
Treasury Department:
Bank supervision
3, 11
Powers affecting bank reserves
5, 21
Trust company members of Federal Reserve System
109-117
Trust powers of National banks:
Conflict in authority of regulating
13
Permits granted
39
United States Government deposits:
Federal Reserve banks:
All banks combined:
1918-1938, End of year
figures
61
1938, End of month figures
61
Dec. 31, 1938
46
Each bank, end of year figures
48
United States Government securities:
Bonds:
Yields
68
Federal Open Market Committee policy actions on
76-84
Federal Reserve bank holdings:
All banks combined:
1918-1938, End of year
figures
61
1938, End of month
figures
61
Dec. 31, 1938
45
Each bank, end of year
figures
48
Earnings on
54
Maturity distribution
47
Member bank holdings:
Sept. 28, 1938
64
Dec. 31, 1938
62
Discussion of
19, 28
Treasury bills:
Discount rates on
68
Treasury notes:
Yields
68
Volume handled by Federal Reserve banks:
All banks combined
53
United States Treasurer:
General account on deposit in Federal Reserve banks. (See United States
Government deposits: Federal Reserve banks.)
Wholesale commodity prices. (See Prices, Wholesale commodity.)
@FedFRASER